Moody’s predicts MMC to hold its position at top of market

 Marsh & McLennan Headquarters New York

Moody’s has announced that it predicts that Marsh & McLennan Cos. Inc. will maintain its current leading position in its main function as an insurance broker and consultant, as it seeks to make improvements to its business performance so that it can gain further hold in the marketplace. 

Lead analyst for Marsh & McLennan at Moody’s, Bruce Ballentine, said that they forecast “MMC’s credit metrics to benefit from restructuring steps and debt reduction achieved over the past few years.”  He went on to explain that the stability of the current rating outlook mirrors Moody’s opinions that MMC will steadily build its operating margins and keep its position as a leader in the market for insurance brokerage and consulting.

Similar to other insurance broker companies, MMC is not without its upcoming struggles.  For example, the soft market pricing of commercial property and casualty insurance, the slow recovery of the economy, and the risk of errors and omissions. 

Though it has managed to maintain a strong worldwide presence in the insurance market, greater successes have been lightened as a result of operating margins that were improving, but still relatively weak. 

Moody’s made its rating on an offering of an MMC 10-year senior unsecured note from a $500 million note.  This offering was assigned a “Baa2” rating from the rating services company. 

MMC stated that it would be using the note to repurchase outstanding notes worth about $600 million and which would be due on 2014 and 2015.  The offer’s closing is on July 15, 2011.

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