Analysts doubt whether new MMC chief Brian Duperreault will split the company
Marsh is unlikely to be sold to Willis following the arrival of Marsh & McLennan’s (MMC) new global chief executive Brian Duperreault, analysts said this week.
Analysts suggested that Duperreault, who replaces Michael Cherkasky, would move to improve revenue growth, margin performance and staff morale, rather than break up the MMC companies and put them up for sale.
In a note to investors, David Small, analyst at Bear Stearns, said: “This news probably takes some of the M&A speculation out of MMC shares, as it is unlikely Duperreault came aboard to split up the company.”
He added: “This news may give a lift to Willis shares, as it appears that investors no longer need to be concerned with Willis buying Marsh.”
Analyst Stifel, Nicolaus & Co said: “Duperreault is very well prepared to evaluate and address the ongoing weaknesses at Marsh, including weak revenue growth, poor margin performance, and low employee morale.”
Duperreault was chief executive of Ace from 1994 to 2004 and, according to Marsh, grew the company's market value from $1.1bn to approximately $19bn. Before Ace, Duperreault worked at AIG for more than 20 years.