Willis Group Holdings has made a “firm offer” to acquire the remaining 70 percent that it does not currently own of French insurance broker Gras Savoye, and to accelerate closing.
The purchase price of the 70 percent stake, including the repayment of outstanding third party debt (estimated to be €40 million), is approximately €550 million, according to Willis.
The firm has also stated that the Gras Savoye board of directors has received the offer “positively”, with the transaction expected to close on or around 31 December 2015, subject to customary regulatory consents and approvals.
The offer must also be accepted by Gras Savoye's shareholders—a decision that can only be made after consultation with Gras its workers' councils.
Following the completion of the transaction, Gras Savoye would become part of the Willis Group, while maintaining its name and brand in key markets, including France.
Dominic Casserley, CEO of Willis Group, said: "In this next phase of our longstanding partnership, Willis and Gras Savoye would deepen further our client service offering and strengthen our reach and expertise.”
“We would help clients in both fast-growing and developed markets to capture opportunities. This deal would unite two complementary global networks, the analytical expertise of both organisations, and two values-based operating models in order to bring more to our clients."
In addition to the firm offer, Willis has issued notice preserving its right under an existing shareholder agreement to acquire the remaining shares in Gras Savoye in June 2016, should the firm offer not be accepted.
If this situation arises, the purchase price would be determined by a formula under the same agreement.
Patrick Lucas, chairman of Gras Savoye, said: "The board of Gras Savoye is delighted to receive the offer from Willis Group. We have worked together for 40 years, and this offer is the logical next step in that relationship.”
“Together we would be stronger and could present a truly impressive worldwide offering to clients, as well as professional development opportunities to our colleagues at Gras Savoye and at Willis."
Gras Savoye has been an associate company of Willis since 1997, when Willis acquired a 33 percent ownership interest, which it gradually increased to 49 percent.
Following years of reorganisations, reorganisation and a subsequent agreement, Willis obtained the option to purchase by 2016 the remaining shares it does not own. Since the reorganisation in 2009, the shareholders have jointly supported the management in its efforts to improve company performance.
