Haley says Aon-WTW deal still on track despite EC suspending investigation

Willis Towers Watson’s (WTW) CEO John Haley still expects his firm’s acquisition by Aon to complete in the first half of this year, despite news that the EC has temporarily suspended its antitrust investigation into the deal because it is awaiting further information. The EC said on Monday it has halted its in-depth competition review of the planned $30bn deal. “This procedure in merger investigations is activated if the parties fail to provide, in a timely fashion, an important piece of information that the commission has requested from them,” a spokesperson for the EC said. “To comply with merger deadlines, parties must supply the necessary information for the investigation in a timely fashion. Failure to do so will lead the commission to stop the clock. Once the missing information is supplied by the parties, the clock is restarted and the deadline for the commission’s decision is then adjusted accordingly,” the spokesperson added. The EC’s previously announced deadline for its decision on the deal was 10 May. When the probe was launched back in December, Aon said it still expected to meet its completion schedule for the first half of 2021. And WTW’s CEO John Haley said during his company’s results call on Tuesday that the deal is still on track to hit that deadline. “In March of last year when we first announced this, we had said we expect it to close in the first half of 2021. And that's because this is a complex process and has filings required around the world – we are still on course to close in the first half of 2021, where we still expect to meet that deadline,” he said, according to results service Seeking Alpha. “The biggest and/or the most immediate issue we have right now towards moving the transaction along is getting regulatory approvals throughout the world to do that. And we are, as I said, in response to an earlier question, we had targeted first half of 2021. We're still on track for that. There's nothing that's happened that has made us think that that we should change that timeframe. So, we're expecting to get there,” he added. Mr Haley said he couldn’t go into detail about the regulatory process but added that both firms knew it was a complex merger from the start. Opening its probe at the end of last year, EC competition commissioner Margrethe Vestager said the investigation will “assess carefully whether the transaction could lead to negative effects for competition, less choice and higher prices for European customers in the commercial risk brokerage market”. The EC said it is concerned that bringing the two brokers together “could significantly reduce competition” in commercial broking, reinsurance broking and retirement services for commercial clients. In an initial market probe, the EC identified a number of concerns, particularly when it comes to the supply of commercial broking services to large multinational clients that depend on high-level expertise. It said multinational broking services for P&C, financial and professional services, credit and political, cyber and marine risks would be most affected by combining Aon and WTW. It added that broking services to commercial clients of all sizes for aerospace manufacturing risks could also be negatively impacted. During WTW’s results call, Mr Haley argued that innovation for clients is the main rationale for the merger. “I think both Willis Towers Watson and Aon share the view that innovation is needed in our industry, that our industry is not helping clients address a large portion of the risks that they face and that we need to develop better solutions and better products to help them address that,” he said. “And so, the whole notion of why we think we'll be better together is what we can deliver on innovation and it will be in things like, how do we address long-tail events like pandemic? It’ll be in things like cyber. It will be in things like climate change. Both Aon and Willis Towers Watson are addressing each of these individually, but combined we think we'll be able to develop solutions that'll have a much bigger impact on the global economy,” he added.

Haley says Aon-WTW deal still on track despite EC suspending investigation

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