The European Commission (EC) has reportedly been asking for feedback on potential acquirers of assets to be divested due to the merging of insurance and reinsurance broker Aon with Willis Towers Watson (WTW).
There are no surprises in the list of potential acquirers revealed by Reuters yesterday, as the news publisher said that the European Commission (EC) antitrust team are polling rivals and customers of the two brokers about who would be the most suitable buyer of any of the proposed divestitures.
As a reminder, a remedy proposal made to the EC by Aon includes: WTW’s reinsurance unit Willis Re; a number of WTW European corporate risk broking units including Gras Savoye in France, as well as Dutch, German and Spanish entities; specific WTW units in FinPro and cyber in the UK; plus there are rumours that other countries broking units could be included (Italy, Poland and Portugal); while aerospace manufacturing and space broking teams could also be on the block; and the retirement benefits business of Aon in Germany is also said another potential divestiture.
Reuters reported that a questionnaire has been sent out by the EC regulator, to ask which of nine rivals would be the best buyer of WTW assets that have been offered within the remedy package.
The rival companies include Besse, Siaci and Verspieren in France, Funk in Germany, Gallagher and Lockton in the U.S., and Howden, McGill and BGC/Corant in the UK, according to the report.
All of which is unsurprising, some might say uninspiring, as there’s no mention of a tech company buying anyone (a more innovative driving force could have been good for competition), or a global investment bank (Goldman?) buying reinsurance broker Willis Re (an embedded reinsurance arm in an investment bank could be an intriguing proposition and level the market playing-field more), which could have been interesting moves, we feel.
Reuters said the goal of polling competitors and clients is to identify whether buyers of any of these units would need to have specific traits, such as a global network to help in serving multinationals.
Having pushed back its original deadline for making a decision, the EC is now aiming to close its deliberations on the merging of Aon and WTW by July 27th, 2021.
In addition, it’s also worth considering how the prolonged merger is affecting the companies involved.
Rival Marsh McLennan said yesterday that it is benefiting from the disruption such a major acquisition brings to the market.
In fact, MMC CEO Dan Glaser said that his firm saw a 500 person net headcount increase in the fourth-quarter of 2020, the majority coming from Aon or WTW.
In addition, Glaser said that another more than 100 have joined net from Aon and Willis in Q1 2021.
He expects those trends to continue as well.
“Ultimately, it’s not a huge needle mover for us, but it’s a way for us to build our strength, build on the mountain of talent that we already have,” Glaser said.
Finally and also of note on this impending merger, Australia’s competition regulator has also pushed back the end-date of its review of the deal.
Also read:
– Aon in proactive offer to US DOJ on Willis Towers Watson merger: Report.
– Aon – Willis Towers Watson divestiture reports expand to US & Bermuda.
– EC extends Aon – Willis Towers Watson merger deadline again.
– Aon – Willis Towers Watson merger deadline pushed back by EC.
– Aon – Willis Towers Watson merger assessed by Singapore competition authority.
– Aon & Willis Towers Watson merger may face EC statement of objection: Reuters.
– Aon & Willis Towers Watson merger to “significantly lessen competition”.
– Aon & WTW cite alt. capital, disintermediation & marketplaces in defence of merger.
– Aon & Willis Towers Watson reveal leadership of combined company.
– Willis Re divestment seen necessary for Aon – WTW merger to complete.
– If Aon / WTW leads to divestitures, AJG seen as “best fit” for Willis Re: KBW.
– EC investigates Aon / WTW deal, cites competition “concerns”.
– Aon + WTW to “extend proven model of catastrophe bonds” – CEO’s Case & Haley.
– Aon & Willis Towers Watson to merge.
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