Aon plc completes $13.4bn acquisition of NFP to expand middle market reach

Aon plc (NYSE: AON), a premier global professional services firm, has successfully finalized the acquisition of NFP, a leading middle market property and casualty broker, benefits consultant, wealth manager, and retirement plan advisor. The deal, which was initially announced in December 2023, is valued at approximately $13.4 billion, comprising $7.0 billion in cash and $6.4 billion in equity through the issuance of 19.0 million Aon shares.

Enhancing Client Value and Shareholder Returns

Greg Case, CEO of Aon, expressed enthusiasm about the integration, emphasizing the alignment with Aon’s “3×3 Plan” to accelerate the Aon United strategy aimed at enhancing client service and shareholder value. “This acquisition is another example of how we are going further, faster with our 3×3 Plan to accelerate our Aon United strategy and further enhance our relevance to clients,” said Case.

The acquisition significantly boosts Aon’s capabilities across the property and casualty brokerage, benefits consulting, wealth management, and retirement plan advisory sectors. NFP’s robust presence in the middle market, with over 7,700 professionals, complements Aon’s global reach and services portfolio.

Operational Synergies and Leadership Structure

NFP will continue its operations as an “independent and connected” entity within Aon, focusing on Risk Capital and Human Capital services. NFP CEO Doug Hammond will lead the unit, reporting directly to Aon President Eric Andersen. Andersen highlighted the strategic nature of the acquisition: “The idea of being ‘independent and connected’ is key to how we will collaborate and create more options for clients across our Risk Capital and Human Capital capabilities.”

Doug Hammond also commented on the merger’s potential: “With Aon’s acquisition of NFP now complete, we are starting an exciting new chapter in our company’s history. Aon’s diverse resources and global reach enhance our ability to serve the dynamic risk, workforce, wealth management, and retirement needs of our clients.”

Financial Advisement and Legal Representation

Aon’s financial strategies and arrangements for the acquisition were facilitated by UBS Investment Bank and Citi, with Cravath, Swaine & Moore LLP and McDermott Will & Emery LLP providing legal counsel. NFP was advised by a consortium of firms including Evercore, Barclays, BofA Securities, Inc., Deutsche Bank Securities Inc., Jefferies LLC, and TD Securities, with legal guidance from Skadden, Arps, Slate, Meagher & Flom LLP and Ropes & Gray LLP.

This acquisition is poised to significantly alter the landscape of the middle market for professional services, providing Aon with a strategic advantage in reaching and serving middle-market clients more effectively. The swift completion of the deal is expected to bring forward the financial and operational benefits, including accretion and free cash flow enhancements, a year ahead of initial projections.