Marsh & McLennan to buy HSBC's brokerage for $218M

AP News
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Posted: Dec 18, 2009 11:07 AM

Marsh & McLennan Cos. said Friday its insurance brokerage business will acquire the brokerage unit of HSBC Bank for about $218 million in stock and cash.

In addition, Marsh & McLennan's Marsh unit has entered into a partnership with HSBC, under which Marsh will have preferred access to provide insurance brokerage and risk management services to HSBC's corporate and private clients. Marsh said the partnership "will provide additional revenue opportunities to the company."

Marsh's acquisition of London-based HSBC Insurance Brokers Ltd. is expected to close in next year's first quarter, subject to regulatory clearances.

HSBC's brokerage unit has about 1,400 employees in 30 offices in the U.K., Middle East and Asia.

Meanwhile, Marsh's partnership with HSBC "will enable us to leverage HSBC's global network and banking relationships to generate new business," said Dan Glaser, Marsh's chairman and CEO.

Marsh has more than 23,000 employees with clients in more than 100 countries. The company is a unit of New York-based Marsh & McLennan, which is also the parent of companies such as the human resources services provider Mercer and risk consulting firm Kroll.

Shares of Marsh & McLennan fell 18 cents to $21.68 in morning trading.

American Depositary Shares of HSBC Holdings PLC fell 14 cents to $55.21.