Aon Reported Considering Bid to Buy Willis Towers Watson

Aon Plc is considering an offer to buy rival insurance brokerage Willis Towers Watson Plc, according to people familiar with the matter, in what could be the industry’s largest ever merger.

Bloomberg reported that Aon is preparing to submit a bid for Willis Towers in the coming weeks, said the people, who asked to not be identified because the matter isn’t public. The companies have held preliminary talks, the people said. No final decision has been made and Aon could opt to not move forward with an offer, they said.

Shares of Willis Towers jumped as much as 8.3 percent to their highest price ever and traded at $182.72 at 9:46 a.m. in New York, valuing the company at almost $24 billion. Aon was little changed at $169.85 for a market valuation of about $41 billion.

A representative for Aon declined to comment, while Willis Towers couldn’t be immediately reached for comment.

[Editor’s Note: At 1:45 pm EST, Aon confirmed that it is in the “early stages of considering an all-share business combination with Willis Towers Watson.” The broker emphasized that, at this point, its evaluation of a potential transaction is at a preliminary stage and there can be no certainty that any transaction will take place nor as to the form or terms on which any transaction might be pursued. The broker said a further announcement will be made in due course, as appropriate.]

Brokerages — which help connect businesses looking for coverage with insurers — have been aggressively merging in recent years to diversify, boost commissions and serve customers that increasingly want to deal with fewer intermediaries.

Buying Willis Towers would potentially enable Aon to overtake Marsh & McLennan Cos. as the world’s largest brokerage by revenue, according to data compiled by Bloomberg. Willis Towers is the world’s third-biggest brokerage, while Aon is No. 2.

Willis Towers was formed in 2016 through Willis Group Holdings Plc’s $8.9 billion acquisition of the consultancy Towers Watson & Co., the largest insurance broker deal to date.