JARDINE INSURANCE BROKERS WILL SELL US OFFICES TO A&A FOR $54 MILLION

JARDINE INSURANCE BROKERS WILL SELL US OFFICES TO A&A FOR $54 MILLION

Alexander & Alexander Services Inc. announced Monday it will spend $54 million to acquire the U.S. arm of Jardine Insurance Brokers Inc., the better to embrace the U.S. insurance market, despite the JIB Group PLC reporting a loss in its half-year figures.

A&A has agreed to buy most of the U.S. retail-insurance broking and consulting business of Jardine Insurance Brokers Inc. However, the JIB Group's interim results for the first six months of 1995 show a net loss of UK700,000 ($1.08 million) after exceptional items, compared with a profit of UK8.9 million for the same period a year earlier.Jardine Group's chairman, Rodney Leach, said Monday that the sale of the company's U.S. retail business was one of the measures taken to improve profitability.

According to the half-yearly results of the parent group, Jardine's activities in the Americas - mostly U.S. business - made a loss of UK5.2 million before taxes but after exceptional items, while all other geographical areas were profitable.

However, Nick Cosh, the JIB Group's finance director, said that the overall results in the American business were a result of writing off the good will, or flow of revenue, lost through selling a number of Jardine's U.S.-based businesses during the period. The businesses that JIB is holding onto in the United States gave the company a $9 million profit, Mr. Cosh said, speaking

from a car phone in London.

He said JIB had sold off the less-profitable branches where there was little or no growth.

But A&A said it was very happy with the parts of JIB Inc. it had agreed to buy. The company had the opportunity to carve out the parts it wanted, said Garry Sullivan, spokesman for A&A.

"We are extremely pleased with an outstanding fit," he said, adding that the units are expected to add to A&A's profitability in the first year.

He pointed out that the purchase did not include the corporate side of the business. The transaction, subject to regulatory approval and other conditions, is expected to be completed in October.

A&A is acquiring operations in New York City; Los Angeles, San Francisco, San Jose, Stockton and Orange County, Calif.; Kansas City, Mo./ Topeka, Kan.; Houston; Phoenix; Chicago; and Detroit. About 500 Jardine employees are involved.

The transaction excludes the marine business in Jardine's New York City office as well as Jardine Group Services, JIB's Latham, N.Y., human- resource management consultancy.

The Jardine offices involved in the transaction collectively have

revenues of about $60 million. The acquisition price is not to exceed $54 million, half of which is payable in cash on closing. The balance is payable over the next 12 months, subject to post-completion adjustments.

A&A provides risk-management consulting, insurance brokerage and human- resources consulting services from offices in 80 countries.