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
McDonald's Corp. has announced the return of its popular Shamrock Shake milkshake for a limited time at participating U.S. restaurants nationwide. The minty green milkshake is made with McDonald's vanilla soft serve blended with Shamrock Shake syrup and topped with whipped topping. It first debuted on the McDonald's menu in 1970 and has been a seasonal tradition for nearly 50 years. Asia-focused lender HSBC, through its blockchain-powered platform, has reduced the cost of settling foreign exchange trades by 25 percent, Reuters reported quoting a bank executive overseeing the project. Mark Williamson, chief operating officer of FX cash trading and risk management, told that the bank processes between 3,500 and 5,000 trades a day on its "FX Everywhere" system. PepsiCo, Inc. (PEP) reported fourth-quarter core EPS of $1.49 compared to $1.31, prior year. Excluding the impact of foreign exchange translation, core constant currency EPS increased 17 percent year-over-year. On average, 19 analysts polled by Thomson Reuters expected the company to report profit per...
Follow RTT