Global reinsurance giant Munich Re has announced that via its subsidiary Hartford Steam Boiler (HSB), it has acquired technology company relayr, of which it will hold 100% of the shares upon completion.
relayr is valued at $300 million, and offers industry participants end-to-end solutions in the area of the Internet of Things (IoT) and digitalisation. Munich Re states that the joint business model will develop products for clients, offering technology alongside risk management, data analysis and also financial instruments.
Munich Re states that relayr offers industrial companies that are looking to digitalise their business with a comprehensive range of services, from an initial consultation through to overseeing the implementation and supporting operations.
Torsten Jeworrek, member of Munich Re’s Board of Management, said: “The Internet of Things is already changing our world and has the potential to disrupt the traditional insurance and reinsurance industry through new business models, services and competitors. This acquisition is a clear example of our strategy: we are combining our own knowledge of risk, data analysis skills and financial strength with relayr’s technological expertise. This is our basis to develop new ideas for tomorrow’s commercial and industrial world.”
As an example of the services offered by relayr, Munich Re explains that the firm has developed a platform which enables companies to connect new and legacy hardware and software to extract and analyse data from physical objects, such as machines. As a result, this makes it possible to determine when a machine is likely to fail, which companies can use to improve both processes and profitability.
Chief Executive Officer (CEO) of relayr, Josef Brunner, said: “We are delighted to be intensifying our relationship with Munich Re/HSB and working together to drive digitalisation in commercial and industrial markets. We help companies in those markets to successfully navigate disruption and stay relevant. The unique combination of our companies demonstrates the importance of applying first-class technology and powerful financial and insurance offerings to deliver business outcomes to customers. This transaction is a great opportunity to build a global category leader.”
While the President and CEO of Munich Re’s HSB, Greg Barats, who is also responsible for the reinsurer’s IoT strategy, said: “HSB has always focused on insurance and technology. Back in 2016, HSB invested in relayr in an effort to harness the strategically significant business potential offered by IoT. relayr’s end-to-end IoT solutions for the industrial and commercial sectors are an ideal addition to our Group’s capabilities. relayr will help us to rapidly implement our global strategy to develop new IoT solutions for our clients. Digital transformation in the industrial and commercial sectors offers opportunities for new services and financial applications.”
The announcement also claims that relayr’s solutions can cut costs, increase energy efficiency and product quality. While the tech firm’s offering can be applied to many industries, the current focus is on small and medium-sized enterprises. The firm expects that it will be able to grow in the future thanks to Munich Re’s contacts with industrial companies.
relayr will continue to operate autonomously and will also retain its start-up culture in an effort to drive innovation and to attract talent from within the IoT sector.
The closing of the acquisition remains subject to regulatory approvals, which are expected to be obtained within the next four to six weeks, says Munich Re.
“I am really excited to welcome relayr’s employees to our Group. With their expertise and passion, they will help us to move forward with our IoT strategy,” added Jeworrek.
