CORRECTED-Exclusive: Marsh McLennan’s MMA unit eyes London wholesale launch after Howden raid, sources say

By James Thaler

Aug 15 - (The Insurer) - Marsh McLennan is weighing plans to launch a London wholesale broker under its Marsh McLennan Agency (MMA) and McGriff arm, in what sources say could be a strategic counter to rival Howden’s recent raid on its U.S. retail ranks.

The move comes just weeks after Howden hired more than 140 Marsh U.S. retail staff to spearhead its American expansion, escalating tensions between the two global brokers, three senior sources familiar with the matter said.

The initiative is being explored by MMA vice chair and former McGriff chief executive Read Davis, who has been in London this week meeting wholesale partners and potential recruits to gauge market appetite, the sources said.

In some meetings, Davis assured contacts that the startup would not target their staff, they added.

The discussions are preliminary and may not move forward, but Marsh’s management is open to the plan and is prepared to support it if it proceeds, said sources.

The project is in part a response to consolidation in the London wholesale market, with many formerly independent brokers now owned by larger groups or backed by private equity.

Marsh McLennan completed its $7.75 billion acquisition of McGriff in November last year, with the U.S. retail broker's more than 3,500 staff joining MMA.

If launched, the MMA-McGriff venture would join recent startups such as Assurex-backed AG London and Lumen, founded in April by ex-Paragon executives.

Marsh McLennan declined to comment.