It appears global re/insurance broker, Willis Towers Watson (WTW), has decided to return its Aon merger termination fee to shareholders, increasing its share repurchase program by $1 billion.
After news broke yesterday that Aon and WTW decided to scrap their $30 billion mega-merger plans, Aon said that it would be paying WTW the $1 billion termination fee, which the broker appears to be returning to its stakeholders.
WTW’s existing share repurchase program has approximately $500 million remaining on the current open-ended repurchase authority, and the company’s Board of Directors has approved an increase of $1 billion to this existing program.
“Willis Towers Watson is authorized to repurchase shares, by way of redemption, and will consider whether to do so from time to time, based on many factors, including market and economic conditions, applicable legal requirements and other business considerations,” notes the broker.
WTW’s share repurchase program has no termination date and may be suspended or discontinued at any time. The company says that it expects to utilise this authorisation in both 2021 and 2022.
The broker intends to use the significant capital generated by cash flow from operating and non-operating activities to boost its investment in organic and inorganic growth opportunities over the next three years.