The global broking and captive manager merger of Marsh & McLennan and Johnson & Higgins (J&H) has gone well, a key executive here has said.

But the combined firm still needs to take legal and tax advice to determine how to make one legal entity out of what is still two captive management companies in Bermuda.

The merger was first announced mid-March creating the largest insurance and reinsurance brokerage and captive insurance manager of its kind.

Nearly eight months later, Andrew Carr, president and CEO of J&H Marsh McLennan Management (Bermuda) Ltd., has said redundancies in Bermuda will be minimal.

He said, "I'm expecting less now than I anticipated some months ago. In fact, a couple of people are leaving with severance packages who I've been trying to keep for alternative positions. There may be a few more redundancies, but really it is an insignificant number.'' He has spent months preoccupied with the task of making one successful company out of two, even if it is only for his corner of the merged firm's global empire. His normal 45 to 50-hour work week has become a 60 to 70-hour work week.

He conceded, "It is my wife who has had to put up with my long working hours and mood swings. It can't continue and I don't think it will. But when two organisations come together like that, you must first learn how the other works.'' Today, the two former staffs are more of a unit and well received by prospective clients.

"We're having an excellent year of new business. I am only disappointed it has taken me so long to get the two units together.'' Mr. Carr is responsible for 14 offices around the world as head of global captive management for J&H Marsh McLennan, spending much of his time here, but providing guidance and help to other offices from Singapore to Luxembourg.

His counterpart in the separate offshore broking section is senior Marsh Mac executive, Margaret Liptay.

Globally, the captive management divisions have taken longer to integrate than the broking divisions, in part because work on merging captive management operations was started later.

Mr. Carr said, "Our head office first applied their attention where they felt it would do the most immediate good, and those were the major retail broking organisations in the US. Captive management was not at the very top of that list. But now that we are in gear, we are making great progress.'' He said even analysts have been impressed, although the progress comes without the services of some senior people from the former J&H.

He volunteered: "Brian Hall (then chairman of J&H (Bermuda) Ltd.) elected to retire, which isn't terribly surprising because the man had worked long and hard and achieved considerable success. It was a logical thing for him to give serious consideration to. Brian is a friend.

"Roger Gillett (senior vice president of J&H (Bermuda) Ltd.) spent three or four months debating where his future was best served, and in the end decided to leave us. He was offered a good opportunity at ACE Ltd. and elected to pursue it.

"You have to look at it from Roger's perspective. He had spent 20 years with J&H and was very much into how they operated. His job was a very specifically designated one. And I think sometimes rather than change, it is easier to make a fresh start. And I think that was why Roger decided to move on. It is a great opportunity for him at ACE.

"There was only one other senior executive at J&H who left and that was Dick Southworth, who was a broker from Cincinnati in the US who had been in Bermuda a short time and who was only here on a short term basis. He has gone back home.'' Others have also left, some of whom, by Mr. Carr's own words "didn't like waiting for all the dust to settle.'' He said some people from the computer, or management information systems, department, left. And some account executives also resigned.

He said, "We've had a considerable number, about 20 people, leave us, most of them (17) formerly with J&H. That might be explained by the fact that Marsh Mac was the driving partner. Those sitting on the fence who felt more exposed to the change might have been the J&H staff.'' He estimates that by the end of the year, the staff of 235 in Bermuda at the time of the merger would be whittled down to a comfortable 210.

The merger brought a new set of responsibilities for Mr. Carr, who was forced to learn about J&H, their people and how they conducted business. And then compare the differences between the two organisations and determine which would be best for the new operation in the future.

He said, "Some of that comes down to simple structure because of a change in size. One structure might suit a bigger organisation. Some of it included business practices and how one should deliver services to clients. It takes longer than you at first think to gather that information. And then you have to do the comparisons and evaluations.

"I don't work in a vacuum. I try to involve senior team members of both the former firms. Not everybody sees the same answer to each question and you get into a debate and you have to reach a consensus. Sometimes it works very well and sometimes it takes longer than you think.'' The combined organisation now has 780 captives under management worldwide (about 280 in Bermuda), and in fact, have lost non since the merger.

Mr. Carr pointed out: "There was a difference in approach between the two former firms. Johnson & Higgins was a privately owned company and there was a cultural feeling that grew up in that environment. I worked for J&H for five years before joining Marsh Mac and I remember making the comparison with what I found in Marsh.'' Andrew Carr