The European Commission (EC) has greenlighted Aon’s acquisition of Willis Towers Watson (WTW).
The approval, however, comes with several conditions.
Aon had to submit a “remedy package” to address the Commission’s concerns, such as divesting central parts of WTW’s business to international brokerage firm Arthur J Gallagher.
These include:
- WTW’s entire commercial risk brokerage operations in France, Germany, Spain and the Netherlands; its cyber risk business in the UK; a significant set of customer contracts and personnel in the EEA and internationally; its risk business for the space and aerospace manufacturing sector; and its entire global treaty reinsurance will move to Gallagher.
- Aon’s entire German retirement benefits consulting and pension administration businesses will also need to be divested to a “suitable purchaser”, the European Commission said.
EC’s executive vice president Margrethe Vestager, in charge of competition policy, said: “European companies rely on brokers to obtain best possible solutions to manage their commercial risk. Aon and Willis Towers Watson are leading players in the insurance and reinsurance brokerage markets.
“The remedy package accepted by the Commission ensures that European companies, including insurance companies and large multinational customers, will continue to have a good choice and good services when selecting a broker suitable for their needs.”
International roadblocks
Aon will only be able to go ahead with the M&A deal once the European Commission has formally assessed and approved Gallagher as a suitable purchaser.
“The Commission concluded that the transaction, as modified by the commitments, would no longer raise competition concerns. The Commission’s decision is conditional upon full compliance with the commitments,” the EC added.
The $30bn (£21.7bn, €25.3bn) deal between Aon and WTW was first announced in March 2020, but shortly after received scrutiny from regulators across the world surrounding competition.
In December 2020, the EC opened an investigation to assess the merger, followed by a probe by the Australian Competition & Consumer Commission in February 2021.
Last month, the US Department of Justice filed a civil lawsuit against Aon to stop the merger of the two companies.
