Britannia and UK Club advises that a merger process has been commenced between the two clubs, which would in GRT terms would be of the same size as Gard. The merged club would also in USD income terms be of equals size to Gard. Gard additionally writes about USD 300 million in marine hull and energy income. Given that most observers generally were expecting that consolidation would be focused on the smaller and weaker clubs, the move is surprising since it involves the IGA’s second and fifth largest clubs measured in GRT.
Britannia has made the following announcement: “The boards of the Britannia Steam Ship Insurance Association Limited, the United Kingdom Mutual Steam Ship Assurance Association (Europe) Limited and the United Kingdom Mutual Steam Ship Assurance Association (Bermuda) Limited are in merger discussions. The Clubs are leaders in their field and strong supporters of mutuality. The boards of the Clubs will now begin a process to determine whether the merger is possible and delivers appropriate benefit to their respective Memberships. The talks are concurrent with discussions between their managers, Thomas Miller and Tindall Riley, both leading international providers of insurance and professional services, which would also lead to a merger of the respective businesses should the Clubs decide to merge. The Clubs are now going through the process of discussions. Ultimately, the decision on whether to proceed with a merger will be decided by the Members at Special General Meetings to be convened later in the year.” UK Clubs announcement states: “Members will have seen that the Club has just issued a circular advising that it is in discussions with the Britannia P&I Club about a possible merger. This development results from an active process of the Club Board over recent months in which it has examined the Club’s strategic options for the future, and where the key drivers include the preservation of the mutual P&I system, and achieving a scale that enables the most efficient capital structure and cost effective insurance. The merger will also enable the new club to invest in people and resources for the direct benefit of members. The rationale and the benefits of a merger will be considered by the boards of both P&I clubs in the next few months. An additional board meeting is now scheduled for April, where the issues will be discussed in some detail. Then, after a period of further consideration, the boards of both clubs will decide at their Board meetings in May whether they are prepared to recommend the merger to their membership. If so, there would then be a Special General Meeting of each club towards the end of June. If the membership of both clubs votes in favour of the merger, then steps would be taken with a view to creating a single merged club in time for the 2017 renewal.”