Aon Plc and Willis Towers Watson call off mergerFinance | 27 Jul 2021 7:10 am
Aon Plc and Willis Towers Watson Plc on Monday called off a US$30 billion merger that would have created the world's largest insurance broker, saying U.S. regulators' objections created unacceptable delay and uncertainty, Reuters.
The decision, hailed by some as an early victory for the Biden administration's Department of Justice, which sued last month to block it, stood at odds with European regulators who recently approved the deal on condition the companies sell assets.
Those now-halted sales largely affect broker Arthur J. Gallagher & Co. Combining Aon and Willis, which rank second and third in revenue behind Marsh & McLennan Cos Inc, would have created a new leader with US$20.3 billion in annual revenue, compared with US$17.2 billion for Marsh.
Aon will pay Willis a US$1 billion termination fee, the timing and financial impact of which was not immediately clear.
Aon reports second-quarter results on Friday. Willis said on Monday it would boost share repurchases by US$1 billion.
"Despite regulatory momentum around the world ... we reached an impasse with the U.S. Department of Justice," Aon Chief Executive Greg Case said in a statement.
U.S. Attorney General Merrick Garland called the termination "a victory" because employers "rely on insurance brokers like Aon and Willis Towers Watson for managing the complexities of these health and retirement benefits," he said.
Aon declined to comment. Willis did not immediately respond to a request for comment. Aon's shares were up 9.6 percent at US$254.72, while Willis Towers' stock fell 9 percent to US$205.93 in New York trading.