Marsh & McLennan Companies, Inc. has announced that it has reached an agreement to acquire Jardine Lloyd Thompson Group plc.
The transaction has been approved by the Board of Directors of each of MMC and JLT. Under the terms of the transaction, holders of JLT’s common shares will receive cash consideration of £19.15 pounds per share. Total cash consideration equates to $5.6 billion U.S. dollars in fully diluted equity value, or an estimated enterprise value of $6.4 billion. The transaction will be funded by a combination of cash on hand and proceeds from debt financing.
“The acquisition of Jardine Lloyd Thompson creates a compelling value proposition for our clients, our colleagues and our shareholders. The complementary fit between our companies creates a platform to deliver exceptional service to clients and opportunities for our colleagues. On a personal level, I have come to know, and respect, Dominic Burke and his management team from my time both at MMC and as an underwriter. I am confident that with the addition of the talented colleagues of JLT, Marsh & McLennan will be an even stronger and more dynamic company,” said Dan Glaser, President and Chief Executive Officer of MMC.
Following completion of the transaction, Dominic Burke, Group Chief Executive of JLT, will join MMC as Vice Chairman and serve as a member of MMC’s Executive Committee.
Burke said “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.”
JLT was created in 1997 when Jardine Insurance Brokers plc, which was formed almost 50 years ago, merged with Lloyd Thompson Group plc. The firm now operates in 40 countries with particular strength in the UK and Australia as well as in key emerging markets across Asia and Latin America.
The acquisition of JLT accelerates MMC’s strategy to be the preeminent global firm in the areas of risk, strategy and people. MMC has committed bridge financing from Goldman Sachs to satisfy certain funds requirements of the U.K. Takeover Code to complete the transaction.
The transaction is intended to be effected by means of a U.K. court-sanctioned scheme of arrangement and is expected to close in spring of 2019, subject to receipt of required antitrust and regulatory approvals and the approval of JLT shareholders. MMC has received irrevocable undertakings from JLT’s largest shareholder, Jardine Matheson Holdings, and JLT directors who collectively represent 40.5 per cent of the issued and outstanding JLT shares in support of the transaction.
Goldman Sachs acted as financial advisor and Slaughter and May and Wachtell, Lipton, Rosen & Katz acted as external legal counsel to MMC. J.P. Morgan Chase served as financial advisor, and Clifford Chance Rogers & Wells served as external legal counsel to JLT.