Standard & Poor’s affirmed its ratings on Marsh & McLennan Companies (MMC). The outlook has been revised to stable from negative. The rating actions reflect the diversity and strength of MMC’s various operating businesses, excellent operating performance, and above-average debt service capabilities. The revised outlook reflects S&P’s reduced concern about quality of capital issues associated with about $5.3 billion of goodwill on MMC’s balance sheet as of Sept. 30.
S&P said MMC, through its subsidiaries of Marsh, Putnam and Mercer, has an excellent reputation and leading market positions in insurance and reinsurance brokerage, asset management, and consulting businesses, respectively. The strength of the organization lies in its diversity as well as in its global infrastructure, extensive client base, and well-rounded portfolio of products and services.
The company also enjoys excellent operating performance. Excluding the $173 million in special charges related to restructuring and the World Trade Center terrorist attacks, MMC’s operating margins remain very strong. As of the first nine months of 2001, MMC’s operating margin grew to 22.9 percent compared with 20.3 percent for the same period a year ago.
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