Canadian drinks and media giant, Seagram will buy PolyGram, the music and entertainment combine controlled by Dutch-based Philips, for $10.6 billion (£7.4 billion), creating "the world's largest music company," the firms announced last night. Seagram, which owns MCA Records and Universal Studios, also said it would float shares of its Tropicana juice unit in an effort to realign company assets.

European Monetary Union will lead to lower insurance costs for consumers and consolidation in the industry, according to Mr Chand Kohli. Speaking at the Insurance Institute of Ireland annual conference in Galway, Mr Kohli said huge changes are taking place in the insurance sector. Insurance companies operating in European markets have not been able to achieve the significant economies of scale available in a single market because there is still no single insurance market in Europe, he said. But the pace of change is increasing and will accelerate further inside EMU. Mr Kohli is head of insurance practices in Europe at accountants Price Waterhouse.

This combination of industry change and the EMU "will ultimately result in lower priced insurance, price competition, industry consolidation pressures and a much bigger potential market with more non-EU entrants", he forecast. Because EMU will give insurers a much wider pool of eligible assets for investment, it will have a significant effect on their investment strategies and how their investment functions will be managed, he said. Insurers should be upgrading and consolidating their investment management functions now, he advised.