UPDATE: Marsh to buy Australian broker Honan

UPDATE 8/21/2023, 9:00 AM (EST): Marsh reported it is moving to acquire 100% of the outstanding share capital of Honan Insurance, including 80% of the shares held by TA Associates. Terms of the deal, which is expected to close later this year, were not disclosed.

Upon closing, Andrew Fluitsma, Honan CEO, will report to Nick Harris, Marsh’s CEO for the Pacific region.

“This transaction is good news for both our clients and colleagues who will benefit from the combination of our experience with Marsh’s global resources and solutions,” Fluitsma said in a release.

(Bloomberg) — U.S. insurance broker giant Marsh & McLennan Cos Inc. is nearing agreement to acquire Australian peer Honan Insurance Group Pty Ltd, according to people familiar with the matter.

Marsh and TA Associates, Honan’s private equity owner, are finalizing details of a transaction that could value Honan at about A$700 million ($448 million), the people said, asking not to be identified because the matter is private. A deal could be announced as soon as Monday, they said.

Marsh has emerged as the likeliest purchaser after beating out other rivals in the industry and buyout firms, the people said. While a transaction is likely to be agreed imminently, the companies may have to clear regulatory approvals, the people said.

TA Associates has been working with a financial adviser as it weighed a sale of the business amid interest from prospective buyers, Bloomberg News reported in June.

An announcement could still be delayed and talks could fall apart even though discussions are in the final stage, they said. A representative for Honan declined to comment, while representatives for Marsh and TA Associates didn’t immediately respond to requests for comment outside business hours.

Marsh, based in New York and established in 1871, has businesses in 130 countries, making it one of the world’s largest insurance brokers, according to its website. An acquisition of Honan would boost the company’s presence in Australia, where it started operations in 1965. It now has branches in about 29 locations across the country with almost 2,000 employees.

Founded in 1964, Honan offers services including designing, pricing and negotiating insurance policies on behalf of mid-market companies across industries including financial institutions, health care and technology, TA’s website shows. It operates in Australia, New Zealand and Southeast Asia.

TA invested in the company in 2020, without disclosing financial details, according to a statement at the time. As part of the deal, management including then-group CEO Damien Honan agreed to continue to lead the business and be shareholders along with TA. Honan is currently the firm’s executive chairman.

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• Insurance-sector mergers & acquisitions drop for the first half of 2023
• 2023 P&C Outlook: Assessing the impact of higher rates & greater underwriter scrutiny

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