Aon, the global management consultant, has announced its intention to acquire middle-market insurance firm NFP in a substantial cash and stock transaction valued at $13.4 billion. The deal, revealed on Wednesday, is set to be financed through $7 billion in cash and $6.4 billion in Aon stock.
Aon anticipates significant gains from the transaction, projecting pre-tax benefits exceeding $2.8 billion, offset by $400 million in transaction and integration costs. The acquisition is scheduled to be finalized in mid-2024, with a positive impact on adjusted earnings per share expected by 2027.
This strategic move by Aon aims to enhance its footprint in the rapidly expanding middle-market segment of the insurance industry, encompassing risk, benefits, and retirement, as well as wealth plan advisory services. Doug Hammond, the current Chair and CEO of NFP, will continue to lead the business under the oversight of Aon’s President, Eric Andersen.
Commenting on the acquisition, Andersen stated, “NFP has one of the most high-performing leadership teams and cultures that I’ve come across in the marketplace in my 30-plus years in the business.”
Despite the optimistic outlook, Aon’s shares experienced a 5.6% decline, reaching $295.61 per share as of 12:30 p.m. ET on Wednesday, with a 1.4% decrease year-to-date. Investors and industry analysts will be closely monitoring the developments surrounding this significant acquisition in the coming months.
