Aon is promoting US pension and medical insurance corporations for $ 1.four billion

Aon is seeking regulatory approval from the US Department of Justice for its landmark merger with Willis Towers Watson through the sale of its US retirement pension and health insurance businesses in a $ 1.4 billion transaction.

The company’s entire US annuity business will be sold to asset manager Aquiline, a $ 6.4 billion investment firm, and its Aon Retiree Health Exchange platform will be sold to corporate services provider Alight, Aon announced Thursday.

The sale of the US pension business to Aquiline includes Aon’s core business advisory services, pension administration, the US portion of Aon’s international pension business and various instruments for defined benefit plans.

As part of the transaction, around 1,000 Aon employees will also switch to Aquiline. Aon will retain its non-US actuary, pension administration and international annuity businesses.

“The retirement solutions sector will benefit from an increased focus on long-term investment security and risk management of the plans,” said Jeff Greenberg, Chairman and CEO of Aquiline. “We look forward to working closely with customers, management and colleagues in Aon’s US repurchase business to create further value for all stakeholders.”

Aon’s decision to divest parts of its business is made to resolve any challenges related to the US Department of Justice’s merger with Willis Towers Watson, particularly in its operating jurisdictions.

“The agreements are designed to clarify certain issues that the US Department of Justice has raised in relation to the merger in relation to the markets in which these companies operate,” said Aon.

Aon and Willis Towers Watson expect to complete an all-stock merger of the world’s largest insurance broker in September this year, resulting in a $ 80 billion company.

But the scope of the merger has terrified the US Department of Justice antitrust authorities, who fear that pricing power will be uneven. The merger means Aon and Willis Towers Watson can overtake another firm, Marsh and McLennan, as the world’s leading insurance broker.

The two companies have already parted ways with other parts of their business. In May, the companies sold Willis Re, the broker reinsurance business, to Arthur J. Gallagher and Co. in a $ 3.6 billion transaction. In April, Aon sold its retirement and investment business in Germany. Around $ 2.3 billion in sales were sold in 2020.

“These agreements further accelerate our momentum towards completing our proposed combination with Willis Towers Watson,” said Greg Case, CEO of Aon, in a statement.

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Tags: Aon, Aon Group, Broker, Mergers and Acquisitions, Purchase, Share Price, Willis Group, Willis Towers Watson

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