Guy Carpenter To Acquire Collins

Guy Carpenter & Company, LLC has agreed to acquire Minneapolis-based John B. Collins Associates, Inc., a privately-held reinsurance intermediary.

Terms of the transaction were not disclosed, according to a Guy Carpenter spokesperson.

Collins places reinsurance coverage for companies in the property-casualty, life, and accident & health insurance markets, and is the seventh largest reinsurance intermediary in the world, according to a statement announcing the acquisition. The company has 190 employees who work from 13 offices throughout the U.S., and in London and Bermuda.

Guy Carpenter said the acquisition of Collins will further strengthen its position in the North American reinsurance marketplace “and support its strategy to continue to diversify through targeted acquisitions.” Guy Carpenter specifically mentioned Collins' strength in crop, Florida property, regional specialty lines and medical malpractice business.

Peter Zaffino, president and chief executive officer of Guy Carpenter, said, “Combining the specialty expertise of Collins with our existing platform will deliver better solutions for our respective clients and create more opportunities for future growth.”

John Collins, chairman and founder of Collins, said in a statement, “The combination of our respective capabilities will benefit both our clients and our organization.”

Guy Carpenter said that following the closing of the transaction, Mr. Collins will serve as vice chairman of Guy Carpenter, and Patrick Denzer, chief executive officer of Collins, will serve as chairman of Guy Carpenter Americas.

The transaction is expected to close early in the second quarter of 2009, following receipt of regulatory approvals and satisfaction of other closing conditions.

Last week, during a conference call with financial analysts at the Merrill Lynch Insurance Investor Conference, Brian Duperreault, president and cheif ececutive officer of New York-based Marsh & McLennan Companies (MMC), of which Guy Carpenter is a part, called building MMC's small-commercial market insurance business a logical step to grow business.

He said the vision for MMC Agencies is to create a hub-and-spoke type of network of agencies, as it grows the business “brick by brick” with the acquisition of small independent agencies.

For the Collins acquisition, Guy Carpenter noted that Lexicon Partners acted as exclusive financial advisor, and Gibson Dunn & Crutcher LLP acted as counsel, to Marsh & McLennan Companies (MMC) and Guy Carpenter in the transaction. Merrill Lynch & Co. acted as exclusive financial advisor, and Shearman & Sterling LLP acted as counsel, to Collins.