Sept 30 (Reuters) - Insurance brokerage Marsh McLennan ( MMC )

said on Monday it has agreed to buy smaller rival

McGriff Insurance Services for $7.75 billion, as the industry

gears up for higher spending on policies from businesses amid an

improving economic outlook.

Wage growth and increasing expectations of a soft-landing

have allowed companies across different sectors to revive

spending on insurance policies despite higher prices, boosting

commissions earned by brokerages tied to the premiums insurers

charge.

Marsh said it expects the deal to enhance its capabilities

across commercial property and casualty, employee benefits,

management liability and personal insurance lines.

Founded in 1886, McGriff is an affiliate of TIH Insurance

Holdings and a provider of insurance broking and risk management

services in the U.S.

The company generated $1.3 billion in revenue for the

trailing 12 months ended June 30, 2024. Its coverage also

includes corporate bonding and surety services, cyber and title

insurance, among others.

Marsh said it expects the cash deal, struck through its

Marsh McLennan Agency business, to close by the end of the year.

It would be funded by a combination of cash and proceeds from

debt financing.

In conjunction with the deal, Marsh said it will assume a

deferred tax asset valued at about $500 million.

Its shares were last trading flat before the bell. The stock

has gained about 18% so far this year, while the benchmark S&P

500 is up 20% over the same period.