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Aon & WTW disclose more on combination to fend off legal challenges

4th August 2020 - Author: Luke Gallin

In an effort to ward off legal challenges delaying Aon’s combination with Willis Towers Watson (WTW), the global re/insurance broker has disclosed some additional details associated with the deal.

aon-willis-towers-watson-logosAfter weeks of speculation, Aon confirmed in March of this year that it will combine with rival broker WTW through a definitive agreement to combine in an all-stock transaction.

Aon and WTW filed a definitive joint proxy statement with the SEC on July 8th, 2020. However, since then, Aon says that five complaints have been filed “seeking to enjoin the transaction and other relief.”

Ultimately, the complaints filed assert claims against certain defendants under Section 14(a) of the Exchange Act for allegedly false and misleading statements in the joint proxy statement; and against certain defendants under Section 20(a) of the Exchange Act for alleged “control person” liability with respect to such allegedly false and misleading statements, explains Aon.

Both Aon and WTW feel that the allegations are without merit and adds that no supplement disclosure is required under applicable laws.

“However, in order to reduce the risk of the Complaints delaying or adversely affecting the transaction and to minimize the costs, risks and uncertainties inherent in litigation, and without admitting any liability or wrongdoing, WTW and Aon have determined to voluntarily supplement the Definitive Proxy Statement by providing the additional information”, says Aon.

The broker has therefore filed a proxy supplement which includes “Supplemental Disclosures” that amend, and supplement disclosures contained in the joint proxy statement issued back in June.

“To the extent that information set forth in the Supplemental Disclosures differs from or updates information contained in the Definitive Proxy Statement, the information in this proxy supplement shall supersede or supplement the applicable information contained in the Definitive Proxy Statement,” says the supplement which was filed with the SEC.

Since the deal was confirmed earlier this year, it’s been a hot topic across the insurance and reinsurance industry. Recently, Aon CEO Greg Case said that the company isn’t expecting to need to divest significantly as it combines with rival WTW.

Aon also announced its results for the second-quarter of 2020 recently, revealing an overall decline in revenue of 4%, somewhat offset by organic revenue growth of 9% in its Reinsurance Solutions division.

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