Aon to buy Willis Towers Watson in $30 billion mega deal
London-based Aon has announced that it will buy London-based Willis Towers Watson in a nearly $30 billion all-stock deal. The two multinational professional services firms provide offerings in advisory, risk management, and insurance broking.
If the merger passes regulatory hurdles, it will create the world’s largest insurance broker, surpassing Marsh & McLennan.
The transaction would create a company with combined equity value of approximately $80 billion. The deal is expected to create an additional $10 billion in shareholder value, according to a press release from Aon.
Aon has 50,000 employees in 120 countries and revenues of $11 billion. Willis Towers Watson has 45,000 employees in 140 countries and revenues of $9.1 billion.
"This combination will create a more innovative platform capable of delivering better outcomes for all stakeholders, including clients, colleagues, partners and investors," said Greg Case, CEO of Aon. "Our world-class expertise across risk, retirement and health will accelerate the creation of new solutions that more efficiently match capital with unmet client needs in high-growth areas like cyber, delegated investments, intellectual property, climate risk and health solutions."
Willis Towers Watson shareholders will receive 1.08 Aon shares per Wills Towers Watson share, a 16.2% premium on the firm’s March 6, 2020 closing share price. Aon shareholders will own 63% of Aon and Willis Towers Watson shareholders will own approximately 37%.
The combined firm will exist as the Aon brand, led by Aon CEO Case and Aon CFO Christa Davies. The headquarters will remain in London.
The move arrives amid falling insurance premium and margins, and challenges from issues such as coronavirus and climate change. Recent major consolidations include Willis’ merger with Towers Watson in 2015 and Marsh’s acquisition of rival Jardine Lloyd Thompson in 2019.
The deal is expected to close in the first half of 2021. Aon’s financial advisor on the transaction is Credit Suisse Securities, and Willis’ financial advisor is Goldman Sachs.
