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Marsh & McLennan (MMC) Arm Acquires to Boost Its Portfolio

Zacks Equity Research

Marsh & McLennan Companies, Inc.’s MMC subsidiary Marsh has acquired Ironwood Insurance Services, LLC, one of the leading independent brokers in the Southeast. The buyout was mainly executed by the middle market agency unit of Marsh, known as the Marsh & McLennan Agency LLC (MMA). However, further terms of the deal were kept under wraps.

Located in Atlanta, GA, the acquired company was founded in 2007 and provides property/casualty insurance, employee benefits and private client solutions to medium-sized businesses and individuals across the United States. For investors’ notice, Ironwood is an established brokerage firm catering to pre-close due diligence, transactional solutions and risk management services to private equity funds and their portfolio companies.

Rationale Behind the Move

The expertise of Ironwood in real estate, construction, energy, manufacturing, professional services and health care industries is projected to be beneficial to MMA. The addition of this brokerage firm to the company’s portfolio would enhance its abilities and resources as well as complement MMA’s expanding national footprint.

Notably, Ironwood expects to fulfil its commitment to provide the community it serves with enriched services.

It is also the right time to take advantage of the evolving private equity, merger and acquisition space, which holds ample growth opportunities for the industry players.

Acquisitions form a major core growth strategy at Marsh & McLennan. This Zacks Rank #4 (Sell) company made numerous purchases within its different operating units, which enabled it to enter new geographies, expand within the existing ones, foray into new businesses, develop new segments and specialize within its existing operations. All these initiatives bode well for the long haul.

Other Buyouts in the Same Space

Recently, Arthur J. Gallagher & Co. AJG ramped up investment in Capsicum Reinsurance Brokers LLP, a full-service global reinsurance broker, and acquired Walsdorf Agency, Inc., a third-generation, family-owned commercial and personal lines insurance agency. Aon plc AON closed the consolidation of CoverWallet, the leading digital insurance platform for small and medium-sized businesses.

Another leading player in the same domain, Brown & Brown, Inc. BRO bought Special Risk Insurance Managers, Ltd., an incorporated Managing General Agent offering innovative insurance products and programs that meet the needs of specialty insurance product market in Canada.

Shares of Marsh & McLennan have surged 34.2% in a year’s time, outperforming its industry’s rally of 31.9%.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


 

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