Marsh & McLennan Continues Acquisition Spree


Marsh & McLennan Companies, Inc. (MMC) has been on an acquisition spree since the beginning of the year. Adding another feather to its cap, the company recently acquired the largest independent insurance agency in North Carolina, Senn Dunn Insurance. The deal was carried out by Marsh & McLennan Agency LLC (MMA.V), a subsidiary of Marsh & McLennan.

Consisting of 155 employees, Senn Dunn, the Greensboro-based company is engaged in property and casualty insurance as well as employee benefits services. Its client base is spread across the U.S., which helps it to generate revenues of approximately $30 million annually. As per the aforementioned deal, all the employees of Senn Dunn will now join MMA’s mid-Atlantic region business and continue their operations in the existing offices in Greensboro, Raleigh, Charlotte, High Point, and Washington.

MMA is focused on acquiring entities that are well established in insurance and risk management businesses. The company has adopted such a strategy to expand its presence in the U.S. middle market business. In consistence with this, Marsh & McLennan deployed $444 million to acquire as many as six companies in the first three months of 2014. The aforementioned acquisition is in accordance with the same.

Senn Dunn is a suitable option when it comes to selecting a client-focused entity that has strong community ties. Marsh & McLennan aims to utilize Senn Dunn’s knowledge and expertise in the North Carolinian set up and tap its huge clientele base to emerge as a preeminent risk management firm that provides clients with P&C and employee benefit services. Therefore, the deal bodes well for the company’s long-term growth, which we project to be 12.3%.

Marsh & McLennan currently carries a Zacks Rank #3 (Hold). However, better-ranked players in the insurance broking business include Aon plc (AON), Cninsure Inc. (CISG) and Erie Indemnity Company (ERIE). All these stocks have a Zacks Rank #2 (Buy) and are worth considering.

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