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Aon / WTW EC remedy doesn’t address needs outside Europe: Report

14th April 2021 - Author: Luke Gallin

Divestment proposals reportedly offered by Aon to the European Commission (EC), designed to secure EU antitrust approval for its proposed merger with Willis Towers Watson (WTW), do not address competition concerns elsewhere in the world.

aon-willis-towers-watson-merger-antitrustAs a result, the insurance and reinsurance broker could be forced to come up with other remedy offers to satisfy the concerns of competition authorities from other parts of the world.

News emerged recently that Aon had offered to sell assets in a number of EU countries in order to gain EU antitrust approval.

According to Reuters, citing people familiar with the matter, Aon’s biggest concession is the proposed sale of Willis Re, while the broker has also proposed to sell WTW’s German retirement benefits and consulting business.

Additionally, sources told Reuters that Aon has offered to sell WTW’s insurance broking operations in France, including Gras Savoye, as well as in Germany, Spain, and the Netherlands.

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The person also said that Aon is offering to sell WTW’s entire P&C business portfolio servicing large multinationals in those four countries and other assets in Europe to service these clients, alongside its financial and professional lines.

However, competition concerns over the combination of Aon and WTW have also been raised outside of Europe, notably in Singapore, Australia, and New Zealand.

And, as the person referenced told Reuters, the current EC remedy package “does not reflect market reality” as it “leaves out multinationals in other countries.”

“It would help a lot if Willis UK is divested because a lot of specialities sit there. Aon needs to divest Willis’ global network. The remedy here is about Europe, it doesn’t address needs outside Europe,” continued the person.

In Europe, the EC has restarted the clock on its investigation into the proposed combination of the pair after concessions were submitted on April 9th, while the deadline for completion was extended to July 12th, 2021. This deadline has now been extended by a further 10 working days to July 27th, 2021.

So, while the EC has again extended the deadline as it continues its investigation into the mega-merger, it remains to be seen what happens in other parts of the world and whether the broker will need to produce additional remedy packages to satisfy competition concerns.

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