Aon sells off US retirement business in pursuit of WTW merger clearance

Aon has agreed to sell its US retirement business to Aquiline and its Aon Retiree Health Exchange business to Alight for approximately $1.4 billion. It is the latest divestiture in Aon’s bid to clear antitrust regulatory obstacles to its merger with Willis Towers Watson (WTW), a rival HR, risk consulting, and insurance broking firm.

Aquiline Capital Partners will acquire approximately 1,000 employees across Aon’s US retirement consulting, pension administration, and US-based international retirement consulting businesses, as well as several technology tools and solutions.

Aquiline is a New York- and London-based private investment firm that has previously invested in numerous retirement businesses. The firm has $6.5 billion in assets under management.

"Aquiline's significant experience across retirement and investments positions us to build on the strong business Aon has created,” said Jeff Greenberg, Aquiline's chairman and CEO. “We look forward to working closely with the clients, management, and colleagues of Aon's U.S. retirement business to create further value for all stakeholders."

Alight, meanwhile, will acquire Aon Retiree Health Exchange, an individual market platform for employers and their retirees. Alight is a large, Illinois-based provider of digital health and wellness solutions with 15,000 employees globally.

"These agreements further accelerate our momentum to close our proposed combination with Willis Towers Watson," said Greg Case, Aon's CEO. "These are very capable teams that have demonstrated exceptional dedication to our clients and our firm. I want to recognize their contributions and reinforce that we are confident they will have similar opportunities with Aquiline and Alight."

WTW last month announced a $3.57-billion deal with Gallagher to sell off select reinsurance, specialty, and retail brokerage operations. Aon in May sold its German investment and retirement business, composed of 350 professionals in five offices, to Lane Clark & Peacock, a UK-based occupational pensions consultancy.

Aon and WTW have together divested $2.3 billion in 2020 revenue to satisfy regulatory bodies in Europe, the US, and elsewhere. The divestitures have also jettisoned more than 7,350 employees. An unmodified merger would have created a firm with nearly 100,000 employees and $20 billion in annual revenue.

According to a Reuters report based on anonymous sources, the European Commission is expected to approve Aon’s $30-billion acquisition of WTW before the end of June.