Aon’s $30bn acquisition of Willis Towers Watson collapses

Insurance updates

Aon and Willis Towers Watson have cancelled a $30bn tie-up that would have created the world’s biggest insurance broker after the US government sued to block the combination.

Aon’s chief executive Greg Case said on Monday that the companies had reached an “impasse” with the US Department of Justice, which he said had taken a position that “overlooks that our complementary businesses operate across broad, competitive areas of the economy”.

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The US government sued to block the deal last month, saying in its lawsuit that the combination would create a “Big Two” in insurance broking and would “eliminate substantial head-to-head competition and likely lead to higher prices and less innovation, harming American businesses and their customers, employees and retirees”.

Aon will pay a $1bn break fee to Willis, under the terms of the deal announced in March last year.

John Haley, Willis’s chief executive, said his company was “well-positioned to compete vigorously across our businesses around the world and will continue to introduce important innovations to the market.”

The decision to abandon the deal comes after competition authorities in the EU, the companies’ other major market, gave the deal the green light earlier this month.

Aon and Willis had agreed to sell $3.6bn worth of assets to their rival Gallagher in order to smoothe that aspect of the deal.

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