insurance broker Aon On Monday, it announced it would buy rival USI Insurance Services from a private equity firm. KKR.
The $17 billion deal, which Aon plans to finance with new debt, is expected to close in the fourth quarter, subject to regulatory approval.
CEO Greg Case appeared on CNBC’s “Squawk Box” on Monday and said the merger would create “the premier U.S. middle market platform.”
“This positions us to bring world-class solutions to America’s underserved midmarket market, setting a new standard for customer leadership for America’s 200,000 midmarket businesses and their 48 million employees.”
Aon’s acquisition builds on the company’s 2024 acquisition of NFP, another insurance broker focused on the U.S. middle market.
An office building with the Aon logo is seen in the central business district of Sydney, Australia, on June 3, 2020, as coronavirus disease (COVID-19) restrictions are eased.
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USI is the 10th largest insurance broker in the United States, with annual revenues of more than $3 billion and more than 10,500 employees, according to a press release announcing the deal.
If the deal closes, USI CEO Mike Sicard will become Aon’s president and global CEO of middle markets.
“Joining Aon is a truly exciting next chapter for our company and an opportunity to accelerate our momentum as part of the Aon United platform,” Sicard said in the release. “We share a strong single company culture with a strong commitment to working together to deliver the best of our capabilities to our clients.”
KKR Partner Chris Harrington said in a press release that Aon is the ideal partner to support USI’s next chapter of growth.
Aon stock fell about 1% in premarket trading Monday. But despite the initial slide, Case said the opportunity to serve the middle market at the scale the company is currently capable of through acquisitions could create significant value for shareholders.
“It’s probably the best thing I’ve done in my 20-year career as a CEO,” he said.
