In the biggest move to hit the shipping and insurance sector for years, Clyde & Co is merging with aviation boutique Beaumont and Son to create a £117m business.
The merger will take effect from 1 July this year and will swell Clydes’ revenues by £13m. Eleven Beaumonts partners will join Clydes’ full equity and one Beaumonts partner will also join Clydes’ six-strong management board.
Clydes senior partner Michael Payton said: “I’ve always admired Beaumonts’ practice enormously. They’re written into 80 per cent of the world’s airlines insurance covers. Aviation has so many parallels with shipping work – in many instances the insurers are the same.”
The firms already share a number of insurance clients, including Ace, AIG, Allianz, The St Paul, Amlin and Brit.
Beaumonts senior partner John Balfour said: “We were coming under increasing pressure in the Far East and Middle East, and for a firm of our size it was difficult to commit the resources.”
Clydes is reporting a turnover of £104m for the financial year 2004-05, with an average profit per equity partner (PEP) of £500,000. Beaumonts’ average PEP was in the region of £280,000 last year. The combined firm will be targeting a turnover of £126m for the next financial year.
Payton said: “After integration costs, we should maintain the same level of profitability.”
The merger may herald a new bout of consolidation in the shipping and insurance sector. Last year Holman Fenwick & Willan established an alliance with Gates and Partners, a firm set up by former Beaumonts senior partner Sean Gates.