Greg Case, CEO, Aon; John Haley, CEO, WTW
Aon and Willis Towers Watson have called off their $30 billion merger deal, citing an impasse with the US Department of Justice (DoJ) as the reason behind the decision to terminate the agreement.
Announced yesterday, July 26, the mutual agreement to terminate the proposed combination—which was first announced in March last year—will end the litigation with the DoJ.
"Despite regulatory momentum around the world, including the recent approval of our combination by the European Commission, we reached an impasse with the DoJ," said Aon CEO Greg Case.
Case added: “The DoJ position overlooks that our complementary businesses operate across broad, competitive areas of the economy. We are confident that the combination would have accelerated our shared ability to innovate on behalf of clients, but the inability to secure an expedited resolution of the litigation brought us to this point."
In mid-June, the DoJ sued to block the deal over concerns it would eliminate vital competition in the market. The department claimed that the "harmful" merger of the two broking giants would lead to higher prices and reduced innovation for US businesses.
Earlier this month, the European Commission cleared the merger, subject to the condition that Willis divest some of its business to Arthur J Gallagher. In a $3.5 billion deal, AJG was expected to acquire a substantive part of Willis’ reinsurance, specialty and retail brokerage operations, but not Willis’ captive-related operations.
John Haley, Willis Towers Watson CEO, said: "Going forward, our focus remains steadfast on our colleagues, our clients and our shareholders. We believe we are well-positioned to compete vigorously across our businesses around the world and will continue to introduce important innovations to the market.
“We appreciate and deeply respect all the Aon colleagues we got to know through this process."
In connection with the termination, Aon will pay the $1 billion termination fee to Willis.
Willis Towers Watson, Aon, Gallagher, Merger Termination, Insurance, Reinsurance, Greg Case, John Haley, North America