Aon-WTW Merger Cancelled
Impending U.S. Department of Justice Trial Too Uncertain
Global brokers Aon and Willis Towers Watson (WTW) in July 2021 announced they had mutually agreed to terminate their combination agreement after the U.S. Department of Justice (DOJ) filed an antitrust lawsuit against the $30bn deal.
Aon also announced the extension of employment agreements for CEO Greg Case and CFO Christa Davies to April 1st, 2026, in a move to reassure financial markets.
The merger was announced in early March 2020, almost a year and a half ago; the DOJ began proceedings as late as June 2021, soon after Aon and WTW had secured approval by the European Commission. The DOJ trial was set to begin in November 2021. The merger parties chose to abandon the deal rather than hope for a quick and favorable trial.
The merger’s delay already had resulted in significant numbers of staff leaving for other insurance or reinsurance brokers.
As a side-effect, number 4 global broker Arthur J. Gallagher (AJG) was expected to acquire several assets from WTW, including reinsurance broker Willis Re. As a result, AJG would have significantly grown its corporate risk and reinsurance businesses. Now those planned acquisitions are unlikely to go ahead.
Aon would have become the largest player in the market, ahead of Marsh-McLennan (MMC), and now will pay a $1bn termination fee to WTW.