TIDMJLT
RNS Number : 3240Q
Jardine Lloyd Thompson Group PLC
29 August 2014
Press Release
Jardine Lloyd Thompson Group plc to drive a new phase of growth
through the significant expansion of its US specialty capabilities
and merger of JLT Specialty and Lloyd & Partners
-- Expansion of US specialty capabilities establishes JLT's
specialty offering on a global platform, supporting ambition to be
one of the world's leading specialty brokers
-- Expansion plan represents significant long term growth
opportunity for JLT in world's largest insurance market
-- Enhanced US presence meets international client demand for
global servicing
-- US specialty operation to be run by Michael Rice, a dynamic
leader with a proven track record
-- Merger of JLT Specialty and Lloyd & Partners creates
leading London Market specialty business
29(th) August 2014, London: Jardine Lloyd Thompson Group plc
("JLT") one of the world's leading providers of insurance,
reinsurance and employee benefits related advice, brokerage and
associated services, is today announcing the significant expansion
of its US specialty capabilities and the merger of JLT Specialty
Ltd. and Lloyd & Partners Ltd. to drive a new phase of growth,
following its successful acquisition of Towers Watson Re last
year.
Expansion of US specialty capabilities
Over recent years, JLT has firmly established a successful
specialty-led strategy and distinctive client proposition that has
driven our growth and positioned us as one of the world's
pre-eminent brokers in those specialty areas where we have chosen
to compete.
This announcement signals a significant expansion of our US
activities into the Group's specialty areas including Energy,
Construction, Financial Lines, Credit, Political & Security and
Aerospace (where we already have a successful US presence).
This decision is driven by the following:
-- The success and growth that we have enjoyed over recent years
by following our specialty-led strategy, resulting in us now having
the brand, size, geographic reach, leadership and people to fulfil
our ambition to create a truly global specialty business
-- The significant demand from clients and leading industry
talent for JLT to challenge the position of the other global
brokers in the US, as evidenced by the quality of the management
team we have put together
-- The unique opportunity to create a dynamic platform for long
term growth in the world's largest insurance market by deploying
our client-first culture and specialty capabilities
-- The growing requirement to deliver our unique proposition on
a global scale, given our clients' increasing requirements for
seamless global coverage
-- The emphasis we are placing on further building our US
operations, as evidenced by our acquisition of Towers Watson Re
late last year to create the world's fourth largest reinsurance
broker
-- The support this expansion plan will provide to our US
reinsurance ambitions
The opportunity JLT has to drive growth and win market share has
allowed us to recruit a very strong leadership team to drive the
success of our US expansion plan.
We have appointed Michael Rice CEO and Pat Donnelly President
and Deputy CEO of JLT Specialty Insurance Services Inc., subject to
them fulfilling their existing contractual obligations. Together
they form a strong leadership team with a proven track record of
success in growing a specialty business in the US market and
provide a strong fit to JLT's client-first culture and
entrepreneurial drive.
Mark Drummond Brady, Deputy Group CEO of JLT, and Jonathan
Palmer-Brown, a member of the JLT Group Executive Committee, will
become members of the US Executive team to support the business'
growth plans and ensure that it is aligned and complementary to the
rest of the JLT Group. We also intend to appoint a new
Non-Executive Director with specific knowledge and experience of
the US insurance market to the JLT Group plc Board.
We have established an enquiry form at www.jltgroup.com/usathat
provides further details on how leading market practitioners can
enquire about the opportunities that exist to become part of our
new US specialty team.
The expansion plan is expected to result in a net investment of
approximately GBP50m during the period 2015 to 2017. This figure
takes account of the costs of building out the business offset by
revenues which are expected to build more slowly.
We anticipate that the majority of this investment will be made
in the first two years of the period and that the business will
start to contribute to profits in 2018 and then generate an
accelerated return thereafter.
We are committed to remaining disciplined in managing the pace
of investment set against the growth of revenue. This includes
making optimal use of the infrastructure we have been putting in
place to support JLT Towers Re.
The investment will be funded from existing cash reserves and
debt facilities and will be fully expensed through the income
statement.
Merger of JLT Specialty and Lloyd & Partners
The bringing together of JLT Specialty and Lloyd & Partners
will create a single specialty business of scale and distinctive
capability, in line with our strategy of focusing on our areas of
specialisation.
The merger is anticipated to create a number of benefits that
will position the enlarged business for enhanced growth:
-- Brings together each business' leading specialty teams into a
single, dynamic operation staffed by many of the best people in the
industry
-- Creates a business of scale and international reach, an
increasingly important factor for both clients and markets
-- Provides a strong cultural, operational and business fit
Subject to the appropriate regulatory approvals, John Lloyd, the
current CEO of Lloyd & Partners, is appointed CEO of JLT
Specialty with Adrian Girling, the current Chairman of JLT
Specialty, being appointed Chairman of Lloyd & Partners. The
merger will take effect for reporting purposes from 1(st) January
2015, at which point John Lloyd and Adrian Girling will become CEO
and Chairman respectively of the combined business which will trade
as JLT Specialty.
The Lloyd & Partners brand will be retained to service and
develop the Group's independent wholesale client base. JLT is
firmly committed to serving the needs of its independent wholesale
clients.
There is limited overlap between the two businesses. More
details will be provided on the anticipated one-off integration
costs and associated savings at the time of our preliminary results
in March 2015.
Commenting on these announcements, Dominic Burke, JLT Group CEO
said:
"The expansion of JLT's US specialty capability builds on the
success we have had over recent years and is the next natural step
in our evolution. Under Michael Rice's dynamic leadership, we are
committed to building the pre-eminent specialty team in the US and
anticipate a very positive response from experienced professionals
interested in joining us. The US is a market in which we see a
significant opportunity and demand for JLT's distinctive offering
and to which we are firmly committed following our successful
acquisition of Towers Watson Re last year.
The merger of JLT Specialty and Lloyd & Partners creates a
real powerhouse in the market in our chosen specialty areas under
John Lloyd's proven leadership. Harnessing their market leading
capabilities into a single business promises to enhance their
ability to meet their clients' international demands, pursue our
Group strategy and deliver market leading organic growth.
Together these plans will drive significant long term benefit
for our clients, our people, our trading partners and our
shareholders."
ENDS
Contacts
JLT
Dominic Burke
CEO
+44 20 7309 8191
Dominic_Burke@JLTGROUP.COM
Mike Reynolds
Group Finance Director
+44 20 7528 4117
Michael_Reynolds@JLTGROUP.COM
Paul Dransfield
Head of Group Corporate Communications
+44 20 7528 4933
Paul_Dransfield@JLTGROUP.COM
Brunswick Group
Dania Saidam (UK)
+44 (0) 20 7404 5959
Beatriz Garcia (US)
+1 (212) 333 3810
Notes to Editors
About Jardine Lloyd Thompson Group plc
Jardine Lloyd Thompson is one of the world's leading providers
of insurance, reinsurance and employee benefits related advice,
brokerage and associated services. JLT's client proposition is
built upon its deep specialist knowledge, client advocacy, tailored
advice and service excellence.
JLT is quoted on the London Stock Exchange and owns offices in
40 territories with more than 9,500 employees. Supported by the JLT
International Network, it offers risk management and employee
benefit solutions in 135 countries.
www.JLTGroup.com
About JLT Specialty
JLT Specialty is the largest business within the JLT Group and
is focused on meeting the insurance broking and advisory needs of
UK and international retail clients within its areas of specialty,
including Construction, Aviation and Financial Lines.
About Lloyd & Partners
Lloyd & Partners is the JLT Group's wholesale broker,
serving independent brokers around the world looking for access to
the London, European and Bermuda markets on behalf of their
corporate clients. Like JLT Specialty, the business is organised
around specialty lines such as Energy, Cargo and Healthcare.
About Michael Rice and Pat Donnelly
Michael Rice has over 25 years' experience in the insurance
industry, specialising in Executive Liability (D&O) Insurance
for Fortune 500, Tech & Telecom and Initial Public Offerings.
Most recently Michael has held the roles of Chairman of Aon's
Financial Services Group and Chief Sales Officer of Aon Risk
Services of the Americas global large account practice group.
Pat Donnelly has over 14 years' experience in the insurance
industry, specialising in Financial and Professional Services. Pat
was most recently the Chief Broking Officer for Aon Risk Solutions
in the US.
This announcement may contain "forward looking statements"
regarding the financial position, business strategy or plans for
future operations of the Group. By their nature, forward looking
statements involve risk and uncertainty, relating to facts that are
beyond the company's ability to control, such as future market
conditions. Any such statements in this announcement speak only as
at the date of this announcement. The company does not assume any
obligation to, and does not intend to, revise or update these
forward looking statements except as required pursuant to
applicable law.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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