US/UK – Mercer Management Consulting has merged its financial services strategy and risk-consulting units with UK strategy consultant Oliver, Wyman & Co. The new operating unit will be called Mercer Oliver Wyman.

Mercer is funding the transaction with cash and stock in its parent company Marsh & McLennan Cos., though details have not been disclosed.

The two companies signed a definitive agreement on February 24 to merge Mercer Management Consulting’s Financial Service Practice, which focuses on commercial banking and property, and casualty insurance and Mercer Risk, Finance & Insurance Consulting (RFI), which provides modelling and risk valuation for insurance companies, government entities and other organisations, with Oliver Wyman.

Mercer Oliver Wyman as it will be known will provide strategy, actuarial, and risk management consulting expertise to the financial services industry. Oliver, Wyman’s staff will form the majority of Mercer Oliver Wyman’s 600 employees in North America, Europe and Asia – no job cuts are expected.

The company will act as a separate unit within Mercer Management Consulting.

John Drizk, chairman of Oliver, Wyman, will be the new company president.

Alan McIntyre, senior relationship manager of Western Europe at Oliver, Wyman will act as interim chief operating officer over the next 18 to 24 months leading the integration effort. Commenting on the deal, he explained that the merger will bring together the services that are lacking at each company.

RFI will bring actuarial expertise to Oliver, Wyman’s risk management services, and Mercer’s financial services will bring expertise in insurance, investment management and retail broking to complement Oliver, Wyman’s strengths in investment banking and capital markets. “It is in no way a defensive move by either side,” said McIntyre.

Mercer’s parent company, Marsh & McLennan, is buying Oliver, Wyman’s partners out of their stakes in the firm with a mixture of cash and stock, confirmed a spokeswoman at Oliver, Wyman. Further details of the deal are not being disclosed at the moment.

The deal is expected to close at the end of the first quarter, with the new company operating as of April 7 2003.