US DoJ sues to block Aon/WTW merger

The US Department of Justice (DoJ) has filed a civil antitrust lawsuit to block Aon’s proposed $30bn (£21.5bn) acquisition of Willis Towers Watson (WTW).

As reported by our sister title, Pensions Age, the DoJ stated that the merger of two of the ‘big three’ global insurance brokers would create a broking “behemoth”, threaten to eliminate competition, raise prices and reduce innovation for American businesses, employers and unions that rely on these services.

These reasons for blocking the merger were presented in the complaint filed in the US District Court for the District of Columbia.

The deal was agreed between Aon and WTW in March 2020 and would create a combined equity value of around $80bn (£57.2bn).

However, the complaint warned that the merged firms could used "increased leverage" to raise prices and reduce the quality of products.

Although the DoJ acknowledged that the firms have agreed to certain divestures in connection with various investigations by international competition agencies, the complaint alleged that these remedies were "inadequate" to protect consumers in the US.

It also alleged that the divestures in the US health benefits and commercial risk broking were "wholly insufficient" to resolve the department's concerns.

“Today’s action demonstrates the Justice Department’s commitment to stopping harmful consolidation and preserving competition that directly and indirectly benefits Americans across the country,” said Attorney General, Merrick B. Garland.

“American companies and consumers rely on competition between Aon and Willis Towers Watson to lower prices for crucial services, such as health and retirement benefits consulting.

"Allowing Aon and Willis Towers Watson to merge would reduce that vital competition and leave American customers with fewer choices, higher prices, and lower quality services.”

    Share Story:

Recent Stories


Podcast: The benefits of private equity in pension fund portfolios
The outbreak of the Covid-19 pandemic, in which stock markets have seen increased volatility, combined with global low interest rates has led to alternative asset classes rising in popularity. Private equity is one of the top runners in this category, and for good reason.

In this podcast, Munich Private Equity Partners Managing Director, Christopher Bär, chats to European Pensions Editor, Natalie Tuck, about the benefits private equity investments can bring to pension fund portfolios and the best approach to take.

Podcast - The power of three: Using Common Contractual Funds to improve tax outcomes for investors
Large asset owners are still investing in equities in a way where they are taxed on their income. The implication is that they get a poorer return. They need to, and can, improve this, but how?

In this podcast, AMX Head of Client and Manager Development, Aaron Overy, and AMX Product Tax Specialist, Kevin Duggan, discuss with European Pensions Editor, Natalie Tuck, about three options to help ensure good withholding tax outcomes for institutional investors.
Mitigating risk
BNP Paribas Asset Management’s head of pension solutions, Julien Halfon, discusses equity hedging with Laura Blows

Europe’s pensions challenges
Francesca Fabrizi meets Matti Leppälä, Secretary General and CEO of PensionsEurope, to discuss the key aims and objectives of the association today.