ACE Closes Fianzas Monterrey Buy - Analyst Blog
02 Avril 2013 - 7:30PM
Zacks
ACE Limited (ACE) acquired Fianzas Monterrey
from New York Life Insurance Company for a cash consideration of
$293 million. This acquisition, announced in Sep 2012, will help
the company expand its surety business.
Based in Mexico and founded in 1943, Fianzas Monterrey primarily
caters to clients in the construction and industrial sectors
offering administrative performance bonds. With three regional
offices, 25 branch offices and an extensive 600 independent agents
and brokers, Fianzas Monterrey is the second-largest surety lines
company in Mexico and the third largest in Latin America.
Surety business forms a part of ACE Limited’s specialty property
& casualty business. Additionally, owing to the promising
economic scenario in the Mexican markets, it expects to capitalize
on the opportunities as and when they are available. Moreover, it
will augment ACE Seguros, the existing commercial lines and
personal accident insurance business in Mexico.
ACE Limited has always considered acquisition as an efficient
strategy to boost inorganic growth and expand its global footprint.
Also, acquisitions have created a turnaround in premium writings
and in turn, have helped the company deliver better numbers, which
we expect to continue going forward.
ACE Limited is scheduled to release its first-quarter 2013 earnings
results on Apr 22 after the closing bell. The Zacks Consensus
Estimate for the first quarter is currently pegged at $1.85,
reflecting nearly a 10% year over year decline.
ACE Limited guided 2013 operating earnings to a band of $6.60–$7.00
per share. The guidance includes catastrophe loss of $450 million.
The Zacks Consensus Estimate for 2013 is $7.68, up 0.5% year over
year.
ACE Limited carries a Zacks Rank #2 (Buy). Property and casualty
insurers AXIS Capital Holdings Limited (AXS),
Cincinnati Financial Corp. (CINF) and Arch
Capital Group Ltd. (ACGL) carry a favorable Zacks Rank #1
(Strong Buy) and appear impressive.
ACE LIMITED (ACE): Free Stock Analysis Report
ARCH CAP GP LTD (ACGL): Free Stock Analysis Report
AXIS CAP HLDGS (AXS): Free Stock Analysis Report
CINCINNATI FINL (CINF): Free Stock Analysis Report
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