logo
Plus   Neg
Share
Email

Marsh & McLennan To Buy Jardine Lloyd Thompson For Enterprise Value Of $6.4 Bln

Marsh & McLennan Companies, Inc. (MMC) said that it agreed to acquire Jardine Lloyd Thompson Group plc (JLT.L), a provider of insurance, reinsurance and employee benefits related advice, brokerage and associated services. Total cash consideration equates to $5.6 billion 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 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.

Following completion of the transaction, Mr. Burke, Group Chief Executive of JLT, will join MMC as Vice Chairman and serve as a member of MMC's Executive Committee.

As per the terms of the transaction, MMC will acquire all issued, and to be issued, share capital of JLT for consideration of 19.15 pounds per share in cash. On the basis of the closing price of JLT shares on September 17, 2018 of £14.32 this represents a 33.7% premium.

Marsh & McLennan anticipates annual cost synergies of approximately $250 million that will be realized over the next three years. It is expected that the realization of these cost synergies will result in one-time integration costs of approximately $375 million.

Marsh & McLennan expect the transaction to be immediately accretive to adjusted cash EPS and, as modeled, will produce a double-digit internal rate of return. On an adjusted GAAP EPS basis, we anticipate the deal will be modestly dilutive in 2019, but we expect it to be neutral to adjusted GAAP earnings per share in 2020.

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% of the issued and outstanding JLT shares in support of the transaction.

For comments and feedback contact: editorial@rttnews.com

Business News

Quick Facts

Editors Pick
Kimberly-Clark Corp. (KMB) reported third-quarter adjusted earnings per share of $1.71, an increase of 7 percent compared to net income per share of $1.60, prior year. On average, 16 analysts polled by Thomson Reuters expected the company to report profit per share of $1.64 for the quarter. Analysts'... South Korean IT services company Samsung SDS has joined with Dutch bank ABN AMRO and Port of Rotterdam Authority for a trial project that applies blockchain to shipping and logistics business. Samsung SDS, the IT arm of South Korean Conglomerate Samsung, and ABN AMRO will connect their blockchain platforms Nexledger and Corda, respectively, with the pilot. Dutch consumer electronics giant Philips Electronics NV reported Monday lower net profit in its third quarter mainly due to the deconsolidation of Lighting. Profit from continuing operations climbed with improved margin and sales. Order intake also increased. Looking ahead, the company reiterated targets for the 2017-2020 period of 4-6 percent comparable sales growth.
Follow RTT