The agreement resolves questions raised by the European Commission and is intended to address certain questions raised by regulators in certain other jurisdictions. Aon and Willis Towers Watson continue to work toward obtaining additional regulatory approval in all relevant jurisdictions, including the United States, where regulators are conducting an independent review of the Aon and WTW combination.
"This agreement demonstrates strong momentum on the path to close our proposed combination with Willis Towers Watson," said Greg Case, Aon's CEO. "We've used this time to align our future leadership team around a one-firm culture that will create new opportunities for colleagues, accelerate innovation on behalf of clients and deliver shareholders the long-term value creation they have come to expect from our team."
Aon remains positioned to further build on the firm's track record of over a decade of progress on key financial metrics and achievement of external commitments. The pending combination with Willis Towers Watson is expected to deliver:
- Revenue growth, margin expansion through delivery of better solutions, increased cash flow and earnings growth and a strong balance sheet, to generate attractive returns for shareholders in the future.
- USD 800 million of cost synergies, taking into account this divestiture and other potential remedies.
- Allocation of any divestiture proceeds according to Aon's ROIC framework, in which the firm expects that share buyback will continue to be its highest return activity.
- Accretion to adjusted EPS, reflecting the synergy potential of the combination, consistent with initially announced accretion projections in year three and over the long term.
"We announced this combination knowing that the complementary capabilities of our two firms would allow us to deliver more value to clients and opportunities for colleagues. The events of the last year have only reinforced that rationale, and this announcement is an important step toward realizing that potential," said John Haley, Willis Towers Watson's CEO. "We appreciate the extraordinary value these colleagues have delivered to our clients and our company. We are confident they have a bright future at Gallagher."
Gallagher is a global leader in insurance, risk management and consulting services - generating more than USD6 billion in 2020 revenue. The company is headquartered in Rolling Meadows, Ill. and has more than 34,000 employees in 56 countries.
Gallagher has agreed to purchase a group of businesses from Willis Towers Watson that includes:
- Willis Re operations globally, excluding operations in mainland China and Hong Kong;
- Global cedent facultative reinsurance, excluding operations in mainland China and Hong Kong;
- Corporate Risk and Broking business unit known as Inspace globally and certain business undertaken for Aerospace Manufacturing clients;
- Corporate Risk and Broking services in certain countries in Europe (France, Germany, the Netherlands and Spain), excluding Affinity; Bermuda; cyber in the UK; and certain accounts in the Houston and San Francisco offices in the U.S.;
- Corporate Risk and Broking services for Property & Casualty and Finex insurance in the European Economic Area, UK, U.S., Brazil and Hong Kong relating to certain large multinational companies headquartered in France, Germany, the Netherlands and Spain;
- Corporate Risk and Broking Finex accounts relating to certain large multinational companies headquartered in the UK; and
- Health & Benefits business units in France, Spain and Germany.