Aon plc and Willis Towers Watson have announced that the firms have agreed to terminate their business merger agreement and end litigation with the U.S. Department of Justice (DOJ).
The proposed combination, which was first announced on 9 March, 2020, has faced a number of regulatory barriers – most recently from the US DOJ bringing an anti-trust lawsuit against the pair.
Despite best efforts Aon has said that it has reached an “impasse” with the DOJ and the “inability” to secure an “expedited resolution” means the deal has come to an end.
Aon CEO Greg Case said: “Despite regulatory momentum around the world, including the recent approval of our combination by the European Commission, we reached an impasse with the U.S. Department of Justice.
“The DOJ position overlooks that our complementary businesses operate across broad, competitive areas of the economy. We are confident that the combination would have accelerated our shared ability to innovate on behalf of clients, but the inability to secure an expedited resolution of the litigation brought us to this point.”
He added: “Over the last 16 months, our colleagues have turned potential challenges into opportunities to advance our Aon United strategy. We built on our track record of innovation, continued to deliver industry-leading performance and progress against our key financial metrics and move forward with the strongest colleague engagement and client feedback scores in over a decade.
“Our respect for Willis Towers Watson and the team members we’ve come to know through this process has only grown.”
In connection with the termination of the business combination agreement, Aon will pay the $1bn (£725m) termination fee to Willis Towers Watson, Willis Towers Watson’s proposed scheme of arrangement has now lapsed, and both organizations will move forward independently.
Willis Towers Watson CEO John Haley said: “Our team’s resilience and commitment are a source of pride and confidence. They have continued to bring to life Willis Towers Watson’s compelling value proposition to better serve our clients in the areas of people, risk and capital.
“Going forward, our focus remains steadfast on our colleagues, our clients and our shareholders. We believe we are well-positioned to compete vigorously across our businesses around the world and will continue to introduce important innovations to the market. We appreciate and deeply respect all the Aon colleagues we got to know through this process.”
Both firms will provide further financial updates and outlooks on their respective Q2 2021 earnings calls, which take place on July 30 for Aon and August 3 for Willis Towers Watson.