Aon and Willis Towers Watson are to merge their businesses in an all-stock deal.
The combined firm, which will operate as Aon, will be led by current Aon CEO Gregory C. Case and Christa Davies, Aon’s chief financial officer, a joint news release Monday said. John Haley, CEO and director at Willis Towers Watson, was named executive chairman of the merged firm.
The firm will maintain its headquarters in London.
The deal is set to complete in the first half of next year.
Aon shareholders will own about 63% of the combined firm, with Willis Towers Watson shareholders owning about 37%. The deal was unanimously approved by the boards of directors of both firms and is subject to shareholder and other approvals, including regulatory. The combined equity value of the firm is about $80 billion.
The board of the combined firm will be made up of proportional members of each firm’s current boards.
Pre-tax cost synergies and reductions are expected to total $800 million three years after completion. Aon and Willis Towers Watson expects about 73% of savings to come from the consolidation of business and central support functions; and about 27% from the consolidation of infrastructure related to technology, real estate and third-party contracts.
“The combination of Willis Towers Watson and Aon is a natural next step in our journey to better serve our clients in the areas of people, risk and capital," Mr. Haley said. "This transaction accelerates that journey by providing our combined teams the opportunity to drive innovation more quickly and deliver more value.”