Aon, Willis Towers Watson Shareholders Approve Merger

Shareholders of insurance brokers Aon and Willis Towers Watson have approved all of the proposals necessary to complete their previously announced combination, the firms announced.

Aon intends to combine with Willis in an all-stock deal valued at about $30 billion that is expected to be completed in the first half of 2021, subject to regulatory approvals. The deal has an implied combined equity value of approximately $80 billion.

Under the terms of the proposed deal, Aon’s shareholders will own 63% and WTW shareholders will own 37% of the combined company. Willis Towers Watson shareholders will receive 1.08 Aon shares in exchange for each Willis Towers Watson share they held immediately prior to the closing.

The deal and terms were first announced on March 9.

Aon and Willis are the second- and third-largest insurance brokers by revenue. If the deal is approved, the combined company, named Aon, will have more than $20 billion in revenue. Aon reported $11 billion in revenue with $2.2 billion net income for 2019 compared to $9 billion revenue and $1.4 billion net income for Willis Towers Watson.

Aon will maintain operating headquarters in London, United Kingdom. The parent company will be incorporated in Ireland. The combined firm will have 95,000 employees globally, with a “significant presence” in Chicago, New York and Singapore.

The combined firm will be led by Aon CEO Greg Case and Aon Chief Financial Officer Christa Davies. The board of directors will comprise proportional members from Aon and Willis Towers Watson’s current directors.

Willis Towers Watson CEO John Haley will take on the role of executive chairman with a focus on growth and innovation strategy.

Following the shareholder approvals, Aon’s Case said the deal makes even more sense now in 2020 than before.

“Our combination, which will accelerate innovation and strengthen our capability to provide more relevant solutions for clients, has only become more important through the COVID-19 pandemic,” said Case. “The events of 2020 are illustrative of the exact type of transformative long-tail risk our new organization will be best positioned to address, creating significant value for clients, colleagues, and shareholders.”

Daniel Glaser, president and CEO of Marsh & McLennan Companies and parent of Marsh, the largest insurance broker, has said the pending acquisition is “not good for the market or for clients but is good for Marsh & McLennan.”

“We think it will give us opportunities,” he said when asked about competition for professional talent in today’s market on a call with analysts. “The big three becomes the big two. How could that not be a benefit to us?”

This is the second run at an Aon-Willis Towers Watson merger. On March 5, 2019, Aon confirmed it was exploring a tie-up with Willis but one day later, it called off the talks.

There have been several shareholder lawsuits filed over the mega-deal. The suits allege that Willis and its directors filed incomplete and misleading information with the U.S. Securities and Exchange Commission on the transaction.


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