UK broker Arthur J Gallagher International is in talks to buy local rival Heath Lambert, according to sources close to the companies.

US-based parent company Arthur J Gallagher recently raised $US125 million ($123.6 million) in a private placement to fund acquisitions.

Heath Lambert, which includes a Lloyd’s operation, would cost £80 million to £100 million ($127.6 million - $159.5 million) based on current market valuations.

However, David Ross, CEO of Arthur J Gallagher (UK), told Insurance Times that the company did not plan to make another Lloyd’s acquisition. In 2010, it bought Lloyd’s broker First City Partnership.

“You are not going to see us acquire another broker in the Lloyd’s market in the next couple of years unless there is a fantastically compelling reason,” Mr Ross said. “There are bigger wins for us that make more strategic sense outside of being a wholesaler.”

Among those wins were plans to establish Arthur J Gallagher International as a retail broker across the UK. With 16 offices around the UK including its London and Lloyd’s operation, Heath Lambert would provide a ready-made branch network.

Marsh purchased the Australia, NZ and PNG operations of Heath Lambert in 2004.