Arthur J. Gallagher today announced plans to enter the Chinese market after the Company signed a joint venture agreement with Jiang Tai Insurance Brokers to establish a new Shanghai-based operation, subject to regulatory approval. The agreement sees Gallagher take a 24.9% share ownership. Other terms of the transaction were not disclosed.
Expected to launch in the first half of 2015, the new operation, trading as Jiang Tai Re, will focus on reinsurance and specialty lines. Jiang Tai’s current President Frank Lu will lead the 25-strong team of experienced, technical insurance professionals.
Understood to be the first joint venture insurance broker launched in the China (Shanghai) Pilot Free Trade Zone, the partnership represents an auspicious and pioneering move for both parties, reflective of their ambition to facilitate diverse economic growth on an international scale.
With this opportunity to develop the Chinese specialty insurance market, Gallagher will bring its specialty and reinsurance expertise and intellectual capital, as well as extensive captive management experience from within the wider group, to the new venture while Jiang Tai will gain a global footprint from partnering with Gallagher, one of the world’s largest providers of insurance broking and risk management expertise.
Vyvienne Wade, International Commercial Director at Arthur J. Gallagher, said: “Our international expansion strategy is to introduce Gallagher’s expertise and capabilities into stable and emerging economies — and the opportunity rarely gets larger or more rapidly emerging than China. But we were only prepared to take this ambitious step with the right partner. As one of China’s largest insurance brokers with a formidable reputation, incredibly strong client relationships and cultural values aligned to our own, Jiang Tai was the natural choice. It is an honour to partner with such highly regarded professionals as Chairman Shen and President Lu as they look to expand their company’s interests on the international stage.”
She added: “We have spent many months building a trusted relationship, learning about our complementary expertise and exploring in detail how we can best bring together our inherent strengths to create a powerful new specialty and reinsurance broker to support Chinese businesses as they expand and develop on a global scale.”
Speaking of the decision to partner with Arthur J. Gallagher, Chairman Shen of Jiang Tai Insurance Brokers, said: “This is an investment we have been planning for some time and it has been of critical importance to choose a partner that has a strong cultural fit with our own. Our delegation has spent a lot of time with the teams at Arthur J. Gallagher & Co., both at the company’s international division base in London and its global headquarters in the US, which clearly showed our two organisations enjoy the same ethos and share the same.