Gallagher Re grows significantly, as AJG completes Willis Re acquisition

Arthur J. Gallagher & Co. has announced this morning that it has now completed its acquisition of substantially all of the treaty reinsurance brokerage operations from Willis Towers Watson plc., so the Willis Re unit, which will now join and trade under its Gallagher Re brand.

With this completion, Gallagher Re grows its influence in the global reinsurance market significantly and the combined businesses will trade as Gallagher Re from more than 70 offices across 31 countries around the world, with around 2400 reinsurance broking staff.

Gallagher Re will now be led by James Kent, Global Reinsurance CEO and the previous leader of Willis Re.

Kent will report to Tom Gallagher, Gallagher’s CEO of Global Property & Casualty Brokerage.

“I’d like to officially welcome our new reinsurance brokerage colleagues to the Gallagher family of professionals,” J. Patrick Gallagher, Jr., Chairman, President and CEO said. “Together, we will build upon our shared focus of outstanding service, expertise and client-centric culture. I am confident the combination will deliver tremendous value to our clients, our global brokerage and risk management teams, and our shareholders.”

New Gallagher Re CEO Kent added, “This combination marks a new chapter for two remarkable reinsurance broking teams as well as for our valued and extremely supportive clients and stakeholders. We are bringing together highly complementary and well-respected reinsurance businesses to create a truly compelling unified reinsurance platform. I am incredibly proud to be leading Gallagher Re into its next phase of growth.”

With this move, Gallagher Re has acquired significant depth of expertise across the reinsurance market, covering analytics capabilities including catastrophe modeling, dynamic financial analysis, rating agency analysis and capital modeling, as well as broadening its specific capacity deployment operations to include insurance-linked securities as well.

As we explained before, the acquisition of Willis Re also included the acquisition of the Willis Re Securities unit, which structures and manages catastrophe bond arrangements, and also facilitates other collateralised reinsurance and ILS deals, alongside capital market activity around capital raising and M&A.

The new ILS focused unit will be rebranded to be called Gallagher Re Securities, we’re told, and this is a significant addition to Gallagher’s capabilities and also dovetails well with its expertise in the Horseshoe and Artex insurance management and facilitation services.

Gallagher Re is now a major reinsurance market player, with greater influence across the transactional and placement parts of the insurance-linked securities (ILS) market as well.

It’s going to be interesting to see how the integration goes and how AJG can recognise synergies between its units and its greatly enlarged reinsurance broking arm going forwards.