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Insurance industry

Marsh & McLennan Companies Acquires Sedgwick Group plc for £1.25 Billion

Strategic Insights

— 2 min read

Marsh & McLennan Companies, Inc. and Sedgwick Group plc have reached an agreement on the terms of a recommended offer for Marsh & McLennan Companies to acquire the entire issued share capital of Sedgwick. The acquisition, valued at approximately $2 billion, will enhance Marsh & McLennan Companies' position as a leading provider of professional services, particularly in risk and insurance services and consulting businesses. Under the terms of the offer, Marsh & McLennan Companies will pay £225 per Sedgwick share and £11.25 per Sedgwick ADS, with the transaction expected to close in the fourth quarter.

Key Takeaways:

  • The acquisition is valued at £1.25 billion (approximately $2 billion), making it one of the largest transactions in the insurance industry.
  • The acquisition will enhance Marsh & McLennan Companies' presence in the United Kingdom and continental Europe and Asia, where Sedgwick's brand name is recognized and respected.
  • The combined entity will have a global reach, with operations in over 100 countries and a workforce of over 36,000 employees.
  • The acquisition is expected to be accretive to Marsh & McLennan Companies' earnings per share, beginning in the year 2000.
  • Sedgwick's consulting business, a leading employee benefits consulting firm, will be combined with Marsh & McLennan Companies' consulting firm, providing growth opportunities.
  • Marsh & McLennan Companies' stock (ticker symbol: MMC) is listed on the New York, Chicago, Pacific, and London stock exchanges.
  • The terms and conditions of the offer will be described in a Current Report on Form 8-K to be filed with the Securities and Exchange Commission later today.

Statistics:

  • Total cash consideration: £1.25 billion (approximately $2 billion)
  • Price per Sedgwick share: 225 pence
  • Price per Sedgwick ADS: £11.25 (approximately $18.34 at 1 pound:$1.63)
  • Sedgwick's issued share capital: 41%
  • Sedgwick's shares held by directors and certain other persons: approximately 225.7 million shares
  • Marsh & McLennan Companies' workforce: over 36,000 employees
  • Operations in over 100 countries
  • Stock listing: New York, Chicago, Pacific, and London stock exchanges (ticker symbol: MMC)
  • Expected earnings per share accretion: beginning in the year 2000

Sources:

  • "Marsh & McLennan Companies, Inc. and Sedgwick Group plc Reach Agreement on Terms of Recommended Offer" (Business Wire, August 25, 1998)
  • Marsh & McLennan Companies' 1997 Annual Report on Form 10-K (Securities and Exchange Commission filings)
  • Reports on Form 8-K and quarterly reports on Form 10-Q (Securities and Exchange Commission filings)
  • Company press releases and announcements (Marsh & McLennan Companies and Sedgwick Group plc)

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