Acquisitions

The Risk and Insurance Services segment completed 11 acquisitions during the first nine months of 2015.


•	January – Marsh acquired INGESEG S.A., an insurance brokerage located in Argentina.


•	May – Marsh acquired Sylvite Financial Services, Inc., a Canada-based insurance consulting firm and Sumitomo Life Insurance Agency America, Inc., an employee benefits brokerage and consulting firm providing employee benefit and other services to U.S.-based subsidiaries of Japanese companies.


•	June – Marsh & McLennan Agency ("MMA") acquired MHBT, Inc., a Texas-based insurance broker and Marsh acquired SIS Co. Ltd, a Korea-based insurance broker and advisor.

•

July – MMA acquired Vezina, a Canada-based independent insurance brokerage firm, Tequesta Insurance Advisors, an employee benefits insurance provider based in Florida, Cline Wood Agency, a Kansas City-based independent specialty insurance agency and J.W. Terrill, a Missouri-based independent insurance agency. Marsh acquired SMEI Group Ltd., a U.K.-based insurance broker providing specialist commercial insurance to small and medium-sized firms.


•	August – Marsh acquired Dovetail Insurance, a leading provider of insurance technology services to the U.S. small commercial market.

The Consulting segment completed 5 acquisitions during the first nine months of 2015.


•	February – Oliver Wyman acquired TeamSAI, a Georgia-based provider of consulting and technical services to the transportation industry, and Mercer acquired Strategic Capital Management AG, a Switzerland-based institutional investment advisor.


•	June – Mercer acquired Kepler Associates, a U.K.-based executive remuneration specialist.


•	August – OWG acquired the Hong Kong and Shanghai franchises of OC&C Strategy Consultants.


•	September – Mercer acquired Comptryx, a global pay and workforce metrics business specializing in the technology sector.

Total purchase consideration for acquisitions made during the first nine months of 2015 was $602 million, which consisted of cash paid of $448 million and deferred purchase and estimated contingent consideration of $154 million. Contingent consideration arrangements are primarily based on EBITDA and revenue targets over periods ranging from two to four years. The fair value of the contingent consideration was based on projected revenue and earnings of the acquired entities. The estimated fair values of assets acquired and liabilities assumed are subject to adjustment when purchase accounting is finalized. The Company also paid $30 million of deferred purchase consideration and $39 million of contingent consideration related to acquisitions made in prior years. In addition, the Company purchased other intangible assets in the amount of $2 million.

The following table presents the preliminary allocation of the acquisition cost to the assets acquired and liabilities assumed during 2015 based on their fair values:



For the Nine Months Ended September 30, 2015
(In millions of dollars)
Cash	$	448
Estimated fair value of deferred/contingent consideration	154
Total Consideration	$	602
Allocation of purchase price:
Cash and cash equivalents	$	17
Accounts receivable, net	22
Other current assets	3
Property, plant, and equipment	5
Intangible assets	247
Goodwill	356
Other assets	3
Total assets acquired	653
Current liabilities	34
Other liabilities	17
Total liabilities assumed	51
Net assets acquired	$	602

Prior Year Acquisitions

The Risk and Insurance Services segment completed fifteen acquisitions during 2014.

•

January – MMA acquired Barney & Barney, LLC, a San Diego-based insurance broking firm that provides insurance, risk management and employee benefits solutions to businesses and individuals throughout the U.S. and abroad, Great Lakes Employee Benefits Services, Inc., an employee group benefits consulting and brokerage firm based in Michigan, and Bond Network, Inc., a surety bonding agency based in North Carolina.


•	February – Marsh acquired Central Insurance Services, an independent insurance broker in Scotland that provides insurance broking and risk advisory services to companies of all sizes across industry sectors.


•	March – MMA acquired Capstone Insurance Services, LLC, an agency that provides property-casualty insurance and risk management solutions to businesses and individuals throughout South Carolina.


•	May – MMA acquired Kinker-Eveleigh Insurance Agency, an Ohio-based agency specializing in property-casualty and employee benefits solutions, VISICOR, a full-service employee benefits brokerage and consulting firm based in Texas, and Senn Dunn Insurance, a full-service insurance brokerage located in North Carolina.


•	August – Marsh acquired Seguros Morrice y Urrutia S.A., an insurance broker based in Panama City, Panama.


•	September – Marsh acquired Kocisko Insurance Brokers, Inc., a full-service commercial insurance brokerage located in Montreal, Quebec.


•	October – MMA acquired NuWest Insurance Services, Inc., a California-based property-casualty agency.


•	November – Marsh acquired Torrent Technologies, Inc., a Montana-based flood insurance specialist.


•	December – Marsh acquired Seafire Insurance Services, LLC, a Kansas-based managing general underwriter, and Trade Insure NV, a leading distributor of credit insurance policies in Belgium, and MMA acquired The Benefit Planning Group, Inc., a North Carolina-based employee benefit consulting firm.

The Consulting segment completed six acquisitions during 2014.


•	February – Mercer acquired Transition Assist, a retiree exchange specializing in helping retirees in employer-sponsored plans select Medicare supplemental health care insurance.


•	September – Oliver Wyman acquired Bonfire Communications, an agency specializing in employee engagement and internal communications based in San Francisco, California.


•	November – Mercer acquired AUSREM, a remuneration research and workforce consulting specialist based in Australia, and Jeitosa Group International, a global HR business consultancy and IT systems integration firm.


•	December – Mercer acquired Denarius, a compensation and benefits survey and information products consulting firm based in Chile, and Oliver Wyman acquired OC&C Strategy Consultants (Boston) LLC (part of the OC&C network), a Boston-based consulting firm specializing in the business media, information services and education sectors.

Total purchase consideration for acquisitions made during the first nine months of 2014 was $573 million, which consisted of cash paid of $426 million and deferred purchase and estimated contingent consideration of $147 million. Contingent consideration arrangements are primarily based on EBITDA and revenue targets over periods ranging from two to four years. The fair value of the contingent consideration was based on projected revenue and earnings of the acquired entities. The estimated fair values of assets acquired and liabilities assumed are subject to adjustment when purchase accounting is finalized. In the first nine months of 2014, the Company also paid $10 million of deferred purchase consideration and $40 million of contingent consideration related to acquisitions made in prior years.

Pro-Forma Information

While the Company does not believe its acquisitions in the aggregate are material, the following unaudited pro-forma financial data gives effect to the acquisitions made by the Company during 2015 and 2014. In accordance with accounting guidance related to pro-forma disclosures, the information presented for current year acquisitions is as if they occurred on January 1, 2014 and reflects acquisitions made in 2014 as if they occurred on January 1, 2013. The unaudited pro-forma information adjusts for the effects of amortization of acquired intangibles. The unaudited pro-forma financial data is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved if such acquisitions had occurred on the dates indicated, nor is it necessarily indicative of future consolidated results.



	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions, except per share figures)	2015		2014		2015		2014
Revenue	$	3,120	$	3,207	$	9,659	$	9,938
Income from continuing operations	$	331	$	305	$	1,271	$	1,207
Net income attributable to the Company	$	326	$	298	$	1,239	$	1,177
Basic net income per share:
– Continuing operations	$	0.61	$	0.55	$	2.32	$	2.16
– Net income attributable to the Company	$	0.62	$	0.55	$	2.32	$	2.15
Diluted net income per share:
– Continuing operations	$	0.61	$	0.54	$	2.30	$	2.13
– Net income attributable to the Company	$	0.61	$	0.54	$	2.30	$	2.12

The consolidated statements of income include the results of operations of acquired companies since their respective acquisition dates. The consolidated statements of income for the three- and nine-month periods ended September 30, 2015 include approximately $48 million and $66 million of revenue, respectively, and $3 million and $4 million of operating income, respectively, related to acquisitions made in 2015.

Pending Acquisition

On September 10, 2015, Marsh and Jelf Group plc ("Jelf") announced their agreement on the terms and conditions of a recommended cash acquisition of 100% of the issued and to be issued share capital of Jelf for total consideration (excluding assumed indebtedness) of approximately $400 million (£258 million). The acquisition will be effected by means of a court-sanctioned scheme of arrangement in the U.K. The transaction is subject to customary closing conditions, including approval of Jelf shareholders and the Financial Conduct Authority, and is expected to close in the fourth quarter of 2015.