On July 1, 2020, Willis Towers Watson and Aon announced a merger agreement that would create the largest insurance broker in the world. The deal, valued at $30 billion, is expected to close in the first half of 2021 pending regulatory approval.
Willis Towers Watson, headquartered in London, is a leading global advisory, broking, and solutions company that helps clients around the world navigate risk, optimize benefits, cultivate talent, and expand the power of capital. Aon, headquartered in Chicago, is a global professional services firm that provides a broad range of risk, retirement, and health solutions.
The merger agreement is expected to create significant value for shareholders of both companies and enable them to better serve clients as a combined entity. The companies have stated that they will continue to operate as separate businesses until the transaction closes.
The merger is likely to have a major impact on the insurance industry, particularly in terms of market share. The combined company is expected to have a market capitalization of approximately $80 billion and will be the largest insurance broker in the world, surpassing current industry leader Marsh & McLennan.
However, the merger agreement has also raised concerns about potential antitrust issues. The U.S. Department of Justice (DOJ) has reportedly requested additional information from the companies regarding the merger, indicating that it may scrutinize the deal closely.
In addition, the COVID-19 pandemic has created significant uncertainty in the insurance industry. The outbreak has led to increased claims and losses for insurers, and many companies have struggled to maintain profitability. The merger agreement may enable the combined company to better weather the pandemic`s impact on the market.
In summary, the Willis Towers Watson-Aon merger agreement is set to create a new industry leader in the insurance industry, but it also raises potential concerns about competition and the impact of the COVID-19 pandemic. The deal is expected to close in the first half of 2021, and many will be watching closely to see how it affects the insurance market as a whole.