Insurance broker Aon will buy risk manager Willis Towers Watson for US$30 billion ($45.54 billion) to form a combined equity value of around US$80 billion.
Aon announced the acquisition on Monday and said the combined company would be named Aon and would maintain operating headquarters in London. The firm would be led by Aon chief executive Greg Case and Aon chief financial officer, Christa Davies.
Willis Towers Watson chief executive, John Haley, would take the role of executive chair to focus on growth and innovation strategy.
“This combination will create a more innovative platform capable of delivering better outcomes for all stakeholders, including clients, colleagues, partners and investors," Case said.
"Our world-class expertise across risk, retirement and health will accelerate the creation of new solutions that more efficiently match capital with unmet client needs in high-growth areas like cyber, delegated investments, intellectual property, climate risk and health solutions."
Willis Towers Watson shareholders would receive 1.08 Aon shares for each Willis Towers Watson Share – representing a 16.2% premium to Willis Towers Watson’s closing share price on 6 March, 2020, the announcement said.
It anticipated a “creation of over US$10 billion of expected shareholder value from the capitalised value of expected pre-tax synergies and net of expected one-time transaction, retention and integration costs”.
Last year, Aon planned to merge with the firm but media reports forced it to reveal it was in the early stages of considering an all-stock offer for the Irish-domiciled company. According to Reuters, the merger agreement came right after a 12-month restriction under Irish rules for revisiting the deal expired.
Aon’s shares dropped 16% on Monday, and a drop of 8% for Willis Towers Watson.