{"id":9490,"date":"2021-05-12T15:01:08","date_gmt":"2021-05-12T14:01:08","guid":{"rendered":"https:\/\/p-i7kp07.project.space\/2022-1\/?p=9490"},"modified":"2021-05-17T09:36:35","modified_gmt":"2021-05-17T08:36:35","slug":"arthur-j-gallagher-co-announces-agreement-to-acquire-certain-wtw-plc-reinsurance-specialty-retail-brokerage-operations","status":"publish","type":"post","link":"https:\/\/trustrc.com\/en\/arthur-j-gallagher-co-announces-agreement-to-acquire-certain-wtw-plc-reinsurance-specialty-retail-brokerage-operations\/","title":{"rendered":"Arthur J. Gallagher &#038; Co. Announces Agreement To Acquire Certain WTW plc Reinsurance, Specialty &#038; Retail Brokerage Operations"},"content":{"rendered":"<div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-1 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"--awb-border-radius-top-left:0px;--awb-border-radius-top-right:0px;--awb-border-radius-bottom-right:0px;--awb-border-radius-bottom-left:0px;--awb-flex-wrap:wrap;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start fusion-flex-content-wrap\" style=\"max-width:1216.8px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-0 fusion_builder_column_1_1 1_1 fusion-flex-column\" style=\"--awb-bg-size:cover;--awb-width-large:100%;--awb-margin-top-large:0px;--awb-spacing-right-large:1.92%;--awb-margin-bottom-large:20px;--awb-spacing-left-large:1.92%;--awb-width-medium:100%;--awb-order-medium:0;--awb-spacing-right-medium:1.92%;--awb-spacing-left-medium:1.92%;--awb-width-small:100%;--awb-order-small:0;--awb-spacing-right-small:1.92%;--awb-spacing-left-small:1.92%;\"><div class=\"fusion-column-wrapper fusion-column-has-shadow fusion-flex-justify-content-flex-start fusion-content-layout-column\"><div class=\"fusion-text fusion-text-1\"><h4>Arthur J. Gallagher &amp; Co. \u00a0today announced an agreement to acquire certain Willis Towers Watson plc reinsurance, specialty and retail brokerage operations as part of a proposed regulatory remedy for the pending Aon plc and Willis Towers Watson plc combination.\u00a0 The transaction is expected to close during the second half of 2021.<\/h4>\n<h4>&#8220;This acquisition will accelerate our long-term strategy by significantly expanding our global value proposition in reinsurance, broadening our retail brokerage footprint and strengthening key niches and specialty brokerage offerings,&#8221; said J. Patrick Gallagher, Jr., Chairman, President and CEO. &#8220;The powerful combination of expertise, geographic reach and scale that this acquisition presents will greatly enhance our offerings to clients and prospects, while also providing significant value for our colleagues, carrier partners and shareholders.\u00a0 Most importantly, I look forward to welcoming more than 6,000 new colleagues to our growing Gallagher family of professionals.&#8221;<\/h4>\n<h4>Benefits of the acquisition are expected to include:<\/h4>\n<ul>\n<li>\n<h4>Expanded global value proposition within reinsurance brokerage<\/h4>\n<\/li>\n<li>\n<h4>Broadened global footprint in retail property casualty and health &amp; benefits brokerage<\/h4>\n<\/li>\n<li>\n<h4>Increased depth in key niches and specialty operations such as energy, construction, cyber, space, and aerospace products<\/h4>\n<\/li>\n<li>\n<h4>A comprehensive suite of analytics capabilities including catastrophe modeling, dynamic financial analysis, rating agency analysis and capital modeling<\/h4>\n<\/li>\n<li>\n<h4>Stronger relationships with major insurance carriers and new relationships with middle market and large account retail clients<\/h4>\n<\/li>\n<li>\n<h4>Added platforms for future tuck-in acquisitions<\/h4>\n<\/li>\n<\/ul>\n<h4><strong>Acquired Operations<br \/>\n<\/strong>The combined operations, which include certain of Willis Re&#8217;s treaty and facultative reinsurance brokerage operations, as well as certain U.K. specialty, European and North American brokerage operations, generated $1.3 billion of estimated pro forma revenue and $357 million of estimated pro forma EBITDAC, in each case for the year ended December 31, 2020. \u00a0These pro forma 2020 estimates incorporate potential revenue breakage (as defined below), as well as normalization of operating expenses and additional necessary investments.<\/h4>\n<h4>Reinsurance Brokerage<u><br \/>\n<\/u>The reinsurance brokerage operations, which include both treaty and facultative reinsurance,\u00a0\u00a0 generated approximately $750 million of estimated pro forma revenue for the year ended December 31, 2020.\u00a0 The business represents over 750 insurance and reinsurance company clients, across more than 25 countries, and places over $11.5 billion of premium annually.<\/h4>\n<h4>United Kingdom \/ European Brokerage<br \/>\nThe U.K. and European brokerage operations generated approximately $500 million of estimated pro forma revenue for the year ended December 31, 2020.\u00a0 European retail brokerage includes certain operations in Germany, Netherlands, Spain and France, including the vast majority of French insurance broker, Gras Savoye.\u00a0 Specialty operations in the U.K principally include cyber, space and aerospace products.<\/h4>\n<h4>North American Brokerage<br \/>\nThe North American brokerage operations generated approximately $50 million of estimated pro forma revenue for the year ended December 31, 2020.\u00a0 This includes certain property\/casualty brokerage business from predominantly middle-market and large-account clients located in select markets such as San Francisco, Houston and Bermuda, across niches such as construction and energy.<\/h4>\n<h4><strong>Key Transaction Terms<br \/>\n<\/strong>Under the agreement, Gallagher will acquire the combined operations for gross consideration of $3.57 billion. \u00a0Gallagher expects to finance the transaction using a combination of long-term debt, short-term borrowings, free cash and common equity.\u00a0 The final funding contemplates Gallagher maintaining its investment grade debt rating.<\/h4>\n<h4>Integration is expected to take approximately 3 years with total non-recurring integration costs estimated to be approximately $350 million.\u00a0 After giving effect to these assumptions and pro forma results discussed above, the acquired operations would have been approximately 9% to 11% accretive to Gallagher&#8217;s 2020 adjusted GAAP EPS excluding earnings from clean energy investments (see table for 2020 non-GAAP reconciliation).<\/h4>\n<h4><strong>Other Acquisition Transaction Information<br \/>\n<\/strong>The transaction is subject to European Commission, U.S. Department of Justice and other regulatory approvals, including regulatory approvals related to the pending Aon plc and Willis Towers Watson plc combination and the proposed remedy.<\/h4>\n<h4>More information, including a presentation outlining the transaction, can be found on the company&#8217;s website at <a href=\"https:\/\/www.ajg.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">www.ajg.com<\/a>. The estimates provided in this release and the presentation on the company&#8217;s website, may be updated before the transaction closes as more information becomes available.<\/h4>\n<h4><\/h4>\n<p>\u00a9 this Article was first published at <span class=\"ccbnTtl\">Arthur J. Gallagher &amp; Co.<\/span><\/p>\n<p>We can not assume any Liability for the content of external links to the article of any Third Party.<\/p>\n<\/div><\/div><\/div><\/div><\/div>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":764,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[89],"tags":[],"class_list":["post-9490","post","type-post","status-publish","format-standard","hentry","category-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Arthur J. 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