- Joseph M Matalon

The US-based international insurance broker Arthur J. Gallagher & Co has acquired a near 40 per cent stake in the ICD Group-controlled insurance broker, CGM Group, it was announced yesterday.

Market analysts estimated that Gallagher paid around J$800 million for the acquisition, but neither side disclosed the financial details of the deal.

The matters remained private, according to CGM's chairman, Joseph M. Matalon, who hailed the partnership as an opportunity for strategic expansion by CGM.

"We have been trading with AJG for sometime in the international market, and in more recent times we have considered the option of taking on a strategic partner in expanding the geographic scope of the company, particularly in Central America," Matalon, who also chairs the ICD Group, told The Financial Gleaner. "AJG seemed a good strategic partner."

Expanding foothold

For Gallagher its hold of thirty-eight-and-half per cent of what is perhaps the English-speaking Caribbean's largest insurance broker allows it to expand its foothold in the region.

"This partnership broadens our international presence and offers our clients an increased spectrum of services and geographic coverage throughout the Caribbean," said V. Patrick Gallagher, Jr., chairman and CEO of Gallagher and Co. said in a statement.

"We are pleased that CGM has chosen Gallagher as its strategic partner and look forward to a long and rewarding relationship," he added.

CGM has offices in Jamaica, Barbados, St. Vincent and correspondent relationships/ licenses in many other islands.

Its other subsidiaries include IIB Re, a reinsurance broker, and Caribbean Risk Managers, which offers risk modelling and management services as well as being the supervisor for the Caribbean Catastrophe Risk Insurance Facility.

For its part, AJG is an international insurance brokerage and risk management services firm, headquartered in Itasca, Illinois.

It has operations in seven countries and does business in nearly 120 countries through a network of correspondent brokers and consultants.

AJG is included in Forbes Platinum 400 as one of the 400 best big companies in America and is traded on the New York Stock Exchange under the symbol AJG.

CGM Group Ltd will now become CGM Gallagher Group Ltd with plans to similarly brand the operating companies.