Willis Group Holdings Public Limited Company (WSH) inked a deal to purchase 49% stake in a leading Indian insurance broker, Almondz Insurance Brokers Private Limited.
This acquisition reflects Willis Group prompt action in the wake of an increase in Foreign Direct Investment cap in the insurance sector from 26% to 49% owing to legislative changes in India.
Almondz Insurance along with its wholly owned subsidiary – Almondz Reinsurance Brokers Private Limited – provides insurance as well as reinsurance services to all the leading insurance companies in India.
The terms of the agreement were not disclosed and the deal is subject to regulatory approval.
The above deal marks a very important step by Willis Group to attain a strong foothold in the rapidly growing and developing Indian insurance sector. The company intends to live up to the expectations of its clients worldwide through its services and expertise, starting with its provision of insurance as well as reinsurance services in India.
The joint venture will not only help Willis Group solidify its global presence but also ramp up its inorganic growth profile.
The company had already stepped into the Indian insurance market, when it signed a deal with Bhaichand Amoluk Consultancy Services Pvt. Ltd. in 2003, to provide insurance broking and risk management services in India.
Willis Group and its subsidiaries have been adopting an inorganic route to expand their business and global footprint and thereby improving the growth trajectory. In Jan 2015, the company inked a deal with Miller Insurance Services LLP to form a leading London-based wholesale specialist insurance broking firm.
In 2014, the company completed the acquisition IFG Group plc, thus solidifying its pensions business and its commitment to improve wealth-planning services. Notably, the company’s solid liquidity cushions its expansion initiatives.
Currently, Willis Group carries a Zacks Rank #3 (Hold).
Other Insurance Brokers Adopting Inorganic Route
Of late, many other insurance companies have pursued accretive acquisitions. Last week, Arthur J Gallagher & Co. (AJG) acquired Arizona-based private placement life insurance distributor Cohn Financial Group, LLC. Moreover, last month Marsh & McLennan Companies, Inc.’s (MMC) subsidiary – Marsh & McLennan Agency LLC – took over The Benefit Planning Group, Inc. Also, last month Brown & Brown Inc. (BRO) announced acquisition of certain assets of Hall-Wright from Texas Security General Insurance Agency, Inc.
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