JLT buys US brokerage for £156m

London-based JLT, an insurance broker and employee benefits adviser to major names including McDonald’s and Bradford-headquartered supermarket Morrisons, is acquiring US-listed Towers Watson’s reinsurance broking division in what has been hailed as a coup for the group.

Towers Watson’s reinsurance broker arm employs around 430 employees across 18 offices in six countries, including a site in London, and made revenues of 166 million dollars (£104m) and pre-tax profits of 26 million dollars (£16m) in the year to the end of June. Towers Watson has an office in Leeds, but it is not involved in the reinsurance broker division.

The combined reinsurance business – to be known as JLT Towers Re initially – will have 700 people across 35 offices in 17 countries.

Reinsurance is cover taken out by insurance providers to protect them against losses.

JLT said the move will accelerate its plans to expand its global reinsurance broking arm and see it benefit from “considerably enhanced scale, capability and market presence”.

JLT’s reinsurance broking boss Alastair Speare-Cole, who will head up the enlarged business, said: “We have long admired Towers Watson as one of the best reinsurance brokers in the world.” Eamonn Flanagan, insurance expert at Shore Capital Stockbrokers, said it was a “terrific snatch”. “We view this as an excellent deal for JLT,” he added.