Professional services firm Aon is set to merge with risk management, insurance brokerage and advisory business Wills Towers Watson in a $30 billion (£60.8 billion) deal that aims to combine and expand complementary organisations to create a technology-enabled global platform.
The transaction is expected to create more than $10 billion (£7.6 billion) in shareholder value. Combined under the Aon name and brand, the organisation will be a global professional services firm focused on areas of risk, retirement, and health.
Willis Towers Watson shareholders will receive 1.08 Aon shares for each Wills Towers Watson share, representing a 16.2% premium to Willis Towers Watson’s closing share price on 6 March 2020.
Under the terms of the agreement, existing Aon shareholders will own 63% of the organisation, to Willis Towers Watson’s 37%. The board of directors will comprise a proportional number of members from each organisation’s current directors.
Further details will be published by Aon on 9 March 2020 through a joint live conference call.
Aon’s financial adviser was Credit Suisse Securities (USA) and its legal advisers were Latham and Watkins, Freshfields Bruckhaus Deringer and Arthur Cox. Willis Towers Watson’s financial adviser was Goldman Sachs, and its legal advisers were Weil, Gotshal and Manges, Skadden, Arps, Slate, Meagher and Flom and Matheson.
John Haley, chief executive officer at Willis Towers Watson, said: “The combination of Willis Towers Watson and Aon is a natural next step in our journey to better serve our clients in the areas of people, risk and capital. This transaction accelerates that journey by providing our combined teams the opportunity to drive innovation more quickly and deliver more value.”
Greg Case, chief executive officer at Aon, said: “This combination will create a more innovative platform capable of delivering better outcomes for all stakeholders, including clients, colleagues, partners and investors. 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.”
Vassos Vassou, professional trustee at Dalriada Trustees, commented: “As a trustee, our key concerns when looking after our members are choice, quality of service and value for money. A tie-up between Willis Towers Watson and Aon will mean the combined business will be a dominant player in the market and will lead to less choice for trustees looking for third-party support.
“When it comes to quality of service and value for money, trustees will need to be alert to any impact on their scheme especially smaller schemes if the combined new business ends up focusing its efforts on large schemes.”