Marsh McLennan Announces Pricing of $1,000,000,000 Senior Notes Offering

Rhea-AI Summary

Marsh McLennan (NYSE: MMC) announced the pricing of $500 million aggregate principal amount of its 5.150% Senior Notes due 2034 and $500 million aggregate principal amount of its 5.450% Senior Notes due 2054. The company plans to utilize the net proceeds for general corporate purposes. The Notes offering is expected to close on February 20, 2024, with notable book-running managers involved in the process.

Financial Analyst

The pricing of $500 million of 5.150% Senior Notes due 2034 and $500 million of 5.450% Senior Notes due 2054 by Marsh McLennan represents a significant capital market activity. The interest rates attached to these notes suggest a moderate to a high-yield investment, potentially indicative of the current market's risk assessment of the company and the broader economic environment, such as interest rates set by the Federal Reserve. Investors and analysts will be interested in the debt-to-equity ratio post-issuance, as well as the impact on the company's credit rating.

Furthermore, the use of proceeds for general corporate purposes is quite broad and stakeholders would benefit from understanding whether this includes debt refinancing, investment in growth opportunities, or other specific strategic initiatives. The involvement of top-tier investment banks as joint book-running managers adds credibility to the issuance and suggests confidence in the company's financial position and the successful placement of the notes.

Market Research Analyst

Marsh McLennan's decision to issue long-term debt in the form of Senior Notes with maturities in 2034 and 2054 is a strategic move that could be analyzed in the context of the company's long-term financial strategy and the current interest rate environment. It is crucial to consider how the fixed interest rates of the notes might compare to the expected interest rate trajectory over the next decades. If rates are anticipated to rise, locking in current rates could be advantageous for the issuer.

Additionally, the market's reception of these notes can serve as an indicator of investor confidence in the company's future performance and the insurance and professional services sectors as a whole. The demand for these notes, reflected in the spread over the benchmark rates, will provide insights into market sentiment and may influence the company's stock valuation in the short term.

Economist

From an economic perspective, the issuance of Senior Notes by a corporation like Marsh McLennan can be reflective of broader economic conditions, such as corporate credit demand and the cost of borrowing. The selected interest rates for the 2034 and 2054 Notes might be compared with the current yield curve to assess market expectations on future interest rates and economic growth.

Moreover, the timing and scale of this debt issuance may signal the company's outlook on future economic conditions and its capital structure optimization strategy. The decision to raise capital through debt rather than equity could be influenced by the desire to maintain shareholder value while leveraging the cost of capital in a potentially rising interest rate environment.

NEW YORK--(BUSINESS WIRE)-- Marsh McLennan (NYSE: MMC) (the “Company”) announced today that it has priced $500,000,000 aggregate principal amount of its 5.150% Senior Notes due 2034 (the “2034 Notes”) and $500,000,000 aggregate principal amount of its 5.450% Senior Notes due 2054 (the “2054 Notes” and, together with the 2034 Notes, the “Notes”). The Company intends to use the net proceeds from the Notes offering for general corporate purposes. The closing of the Notes offering is expected to occur on February 20, 2024, subject to the satisfaction of certain customary closing conditions.

J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, Goldman Sachs & Co. LLC and RBC Capital Markets, LLC are acting as joint book-running managers for the 2034 Notes, and J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, Morgan Stanley & Co. LLC and TD Securities (USA) LLC are acting as joint book-running managers for the 2054 Notes.

An effective shelf registration statement related to the Notes has previously been filed with the Securities and Exchange Commission (the “SEC”). The offering and sale of the Notes are being made by means of a prospectus supplement and an accompanying base prospectus related to the offering. Before you invest, you should read the prospectus supplement and the base prospectus for more complete information about the issuer and this offering.

You may obtain these documents for free by visiting the SEC website at www.sec.gov. Alternatively, copies may be obtained from any of the underwriters at (i) J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, Attention: Prospectus Department, 1155 Long Island Avenue, Edgewood, New York 11717, or by telephone: 1-866-803-9204; (ii) Wells Fargo Securities, LLC, 608 2nd Avenue South, Suite 1000, Minneapolis, Minnesota 55402, Attention: WFS Customer Service, email: wfscustomerservice@wellsfargo.com, toll-free: 1-800-645-3751; (iii) Goldman Sachs & Co. LLC, Prospectus Department, 200 West Street, New York, New York 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or by emailing Prospectus-ny@ny.email.gs.com; (iv) RBC Capital Markets, LLC, Brookfield Place, 200 Vesey Street, 8^th Floor, New York, New York 10281, Attention: DCM Transaction Management/Scott Primrose, email: TMGUS@rbccm.com, telephone: 1-866-375-6829; (v) Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, toll-free at 1-866-718-1649 and (vi) TD Securities (USA) LLC, 1 Vanderbilt Avenue, 11^th Floor, New York, New York 10017, Attention: Transaction Advisory, toll-free: 1-855-495-9846.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor does it constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.

About Marsh McLennan

Marsh McLennan (NYSE: MMC) is the world’s leading professional services firm in the areas of risk, strategy and people. The Company’s more than 85,000 colleagues advise clients in over 130 countries. With annual revenue of $23 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses. Marsh provides data-driven risk advisory services and insurance solutions to commercial and consumer clients. Guy Carpenter develops advanced risk, reinsurance and capital strategies that help clients grow profitably and pursue emerging opportunities. Mercer delivers advice and technology-driven solutions that help organizations redefine the world of work, reshape retirement and investment outcomes, and unlock health and well being for a changing workforce. Oliver Wyman serves as a critical strategic, economic and brand advisor to private sector and governmental clients.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240214403785/en/

Media:

Erick Gustafson

Marsh McLennan

+1 202 263 7788

erick.gustafson@mmc.com

Investors:

Sarah DeWitt

Marsh McLennan

+1 212 345 6750

sarah.dewitt@mmc.com

Source: Marsh McLennan

FAQ

What is the ticker symbol of Marsh McLennan?

The ticker symbol of Marsh McLennan is MMC.

What is the total aggregate principal amount of the 2034 Notes?

The total aggregate principal amount of the 2034 Notes is $500 million.

When is the expected closing date of the Notes offering?

The closing of the Notes offering is expected to occur on February 20, 2024.

Which companies are acting as joint book-running managers for the 2054 Notes?

J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, Morgan Stanley & Co. LLC, and TD Securities (USA) LLC are acting as joint book-running managers for the 2054 Notes.

What is the intended use of the net proceeds from the Notes offering?

The company intends to use the net proceeds from the Notes offering for general corporate purposes.