Insurance and reinsurance broker Aon is selling its German pension and retirement consulting and investment business to Lane Clark & Peacock LLP (LCP), in another divestment designed to gain European Commission (EC) approval for its acquisition of rival Willis Towers Watson (WTW).
Aon and Willis Towers Watson (WTW) announced last week that they had agreed a sale of assets to rival Gallagher in a package valued at $3.57 billion and including reinsurance broking arm Willis Re.
But European Commission (EC) competition related concerns over the merging of Aon with WTW extend beyond the insurance and reinsurance space, with thee pensions consulting, retirement and investment side also an area of focus.
In order to keep the merger on-track, Aon has announced that it has signed a definitive agreement to sell its pensions consulting, pension insurance broking, pensions administration and investment consulting business in Germany to Lane Clark & Peacock LLP (LCP).
Saying, “The agreement resolves questions raised by the European Commission with respect to the markets in which these businesses are active. Aon and Willis Towers Watson continue to work toward obtaining additional regulatory approval in all relevant jurisdictions, including the United States, where regulators are conducting an independent review of the proposed combination.”
The retirement and investment business that Aon is selling to LCP includes 350 people across five offices in Germany and will be rebranded as LCP on the transaction closing.
“This agreement demonstrates further momentum on the path to close our proposed combination with Willis Towers Watson,” explained Greg Case, Aon’s CEO. “We recognize the significant contributions these colleagues have made on behalf of our clients during their time with Aon. LCP shares with us a culture of innovation and excellence and we know these colleagues have a positive future at LCP.”
“A key part of LCP’s strategy is diversifying the business into different markets with long-term growth potential,” added Aaron Punwani, LCP’s CEO. “The German pensions consulting market is the third largest in the world, after the U.S. and the UK, which makes it a natural place for LCP to achieve a leading position, mirroring what we have achieved in the UK in recent years.
“We see a meeting of minds with the knowledgeable and dynamic people who lead the business in Germany. We are truly excited about welcoming this fantastic team as part of LCP and achieving great things together for the benefit of our people and our clients.”
Aon noted that this transaction with LCP is “contingent on the completion of the pending Aon and Willis Towers Watson combination, as well as other customary closing conditions.”
There are other countries where benefits, retirement and pensions related units of Aon and WTW may be considered likely to become too dominant once paired, so there is a chance we could see other divestments from these areas of the Aon or WTW business over the coming weeks.