Marsh Sells Crump
To Private Equity Firm
By Mark E. Ruquet
Marsh has signed an agreement to sell its wholesale brokerage operation–Crump Group Inc.–to an affiliate of J.C. Flowers & Company, LLC, a New York-based private equity firm. Terms of the deal were not released.
Marsh, the insurance brokerage arm of Marsh & McLennan Companies in New York, said the sale is subject to normal and customary closing conditions.
Marsh's sale of Crump comes after MMC settled earlier this year with New York Attorney General Eliot Spitzer over allegations that managers within the organization steered contracts to insurers in return for profitable volume-based contingent commissions, against the best interests of clients.
MMC announced in May it was exploring the sale of Crump after Willis Group Stewart Smith sold its wholesale brokerage business to American Wholesale. Aon also said it was looking into alternatives for its Swett & Crawford wholesale unit.
Analysts have said the moves were made in an effort to remove any semblance of a conflict of interest from the brokerage firms. In addition to MMC, Aon, Willis and Arthur J. Gallagher have made settlements with various state attorneys general over steering allegations related to contingency fees.
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