Jeffrey Greenberg, chairman and chief executive of embattled insurance broker Marsh & McLennan Cos., is expected to step down within hours, a newspaper reported on Friday, citing people close to the discussions.
The Financial Times said Jules Kroll, the founder and former executive chairman of security company Kroll Inc., is expected to replace Greenberg. Kroll was acquired by Marsh earlier this for $1.9 billion.
A spokeswoman for Marsh declined to comment.
Marsh shares, which had risen earlier in the day on speculation Greenberg would be forced out, rose sharply on news of the FT’s report.
New York Attorney General Eliot Spitzer sued Marsh & McLennan last week, accusing the company of rigging bids in the insurance market.
At that time, Spitzer said he could no longer speak with the company’s senior management, implying that changes at the top were necessary.
Questions about Greenberg’s future at the company have cropped up in recent days, with investors wondering why Greenberg or other senior managers have done little to publicly defend its corporate image.
“The reason everybody is worried about Jeffrey Greenberg is he hasn’t said anything yet, and speculation (of a departure) is rife,” Gerry Bollman, executive vice president at asset manager Great Companies LLC, told Reuters on Thursday.
Spitzer’s suit targets a practice known as “contingent commissions,” or payments by insurers to brokers to steer business their way. Though not illegal when disclosed, Spitzer charged Marsh with collecting the commissions by rigging bids and fixing prices that inflated costs for clients.