Marsh to create new speciality unit
Marsh & McLennan Companies (MMC) is purchasing Jardine Lloyd Thompson Group (JLT) for $6.4 billion. Both companies have offices and subsidiaries on Bermuda.
Under the terms of the deal, MMC will acquire all issued, and to be issued, share capital of JLT for a consideration of £19.15 pounds per share in cash. On the basis of the closing price of JLT shares on Sept. 17, 2018 of £14.32 this represents a 33.7 percent premium. The board of directors of both companies have approved the transaction.
MMC said that the transaction will be funded by a combination of cash on hand and proceeds from debt financing. The total cash consideration would be $5.6 billion in fully diluted equity value while the total estimated enterprise value is $6.4 billion.
Once the deal is completed Dominic Burke, group chief executive of JLT, will join MMC as vice chairman and serve as a member of MMC’s executive committee.
According to a statement from MMC the acquisition of JLT accelerates its strategy to be "the preeminent global firm" in the areas of risk, strategy and people, and further enhance its ability to drive growth and margin expansion across products and geographies. JLT’s track record of strong organic growth and attractive geographic diversification enhances MMC’s ability to accelerate growth and margin expansion across products and geographies, it added.
“The acquisition of Jardine Lloyd Thompson creates a compelling value proposition for our clients, our colleagues and our shareholders,” said Dan Glaser, MMC CEO. “The complementary fit between our companies creates a platform to deliver exceptional service to clients and opportunities for our colleagues.
“I am confident that with the addition of the talented colleagues of JLT, Marsh & McLennan will be an even stronger and more dynamic company,” Glaser added.
Burke commented: “I am enormously proud of what JLT has achieved, founded on our people, our culture and our unwavering commitment to our clients. MMC is, and always has been, one of our most respected competitors and I believe that, combined, we will create a group that will truly stand as a beacon for our industry.”
MMC said that it has committed bridge financing from Goldman Sachs to satisfy certain funds requirements of the UK Takeover Code to complete the transaction. MMC has received irrevocable undertakings from JLT’s largest shareholder, Jardine Matheson Holdings, and JLT directors who collectively represent 40.5 percent of the issued and outstanding JLT shares in support of the transaction.
MMC, JLT, M&A, acquisition, global, Bermuda, transaction, purchase