After the merger, it will surpass the world ’s largest insurance economy company, Vistamax Group
In the dark day of U.S. stocks witnessed by global investors, the insurance brokerage field has ushered in the largest merger and acquisition case in history—London, UK On March 9, Aon Insurance announced that it would acquire Willis Towers Watson for $ 30 billion.
According to the Financial Times , this transaction In the form of a share exchange, each share of Willis Towers Watson’s stock can be exchanged for 1.08 shares of Yi’an stock. Based on WTW’s closing price of $ 232 last Friday and a total market value of $ 29.86 billion, this transaction has a premium of 16%. Credit Suisse advised Aon Insurance on the transaction, while Willis Towers Watson was advised by Goldman Sachs.
According to CNBC , after the transaction was disclosed, the shares of Aon Insurance fell by 2.7%, while the shares of Willis Towers Yue rose by only 1.42%.
The two parties in this transaction, Aon Insurance and Willis Tower Hyatt, are the second and third largest insurance brokerage companies in the world, respectively. The transaction is expected to be completed in the first half of 2021. After the completion, the company will continue to conduct business under the name of “Yi An Insurance”. The existing shareholders of Ai An will own approximately 63% of the shares, while existing investors of Willis Tower Hyatt will Approximately 37% of the shares of the combined company will have a combined market value of US $ 80 billion, which will exceed the current world’s largest insurance economy company Marsh & McLennan (Vida Group). If you press the Insurance Information Institute’s data < span>, 2018 data The two companies’ revenues totaled $ 19 billion, while Marsh & McLennan’s revenue was nearly $ 17 billion.
This transaction also means that after a long period of time, the global insurance brokerage industry’s profit margins have been continuously compressed and gradually integrated, entering a new stage. Before this transaction, Vistamaxx Group has been the industry leader for a long time. In order to consolidate its position, -55b72926558f “target =” _ blank “> Weidaxin acquired the seventh-ranked competitor Jardine Lloyd Thompson for £ 4.3 billion in cash in 2018. Yian has considered acquiring Willis Tower Hyatt in 2019, but then announced give up.
According to the Financial Times , Aon Group The two companies’ headquarters in central London are only a few meters away, and the merger will generate a synergy effect of US $ 800 million. This is not to save costs. Three-quarters of them are used to integrate the core of the business.
Aean’s share price experienced a 30% increase in the previous year, but the transaction disclosure date was the darkest day in the U.S. stock market for nearly two decades-the U.S. stock market fell sharply on March 9 and Aean’s stock fell more than 17 %, But the acquisition premium also fell from 16% to 6% at the same time. For Aon, the annual cost savings of $ 800 million after the acquisition can be easily compensated.
However, according to analysts, the merger of the two companies will become the world’s largest insurance brokerage company, which may attract the attention of regulators related to antitrust schemes.
On the team side, the combined company will be led by Aon CEO Greg Case and Aon Chief Financial Officer Christa Davies. Willis Tower Hyatt CEO John Haley will serve as Executive Chairman Focus on growth and innovation strategies.