Aon to sell US retirement business and Aon Retiree Health Exchange for $1.4bn

Aon has signed two separate deals to divest its US retirement business to Aquiline Capital Partners and its Aon Retiree Health Exchange business to Alight Solutions for a total of $1.4 billion.

According to Aon, the transactions are intended to address some concerns raised by the US Department of Justice pertaining to its pending $30 billion merger with Willis Towers Watson (Aon, Willis Towers Watson merger), which was announced last March.

Greg Case – Aon CEO said: “These agreements further accelerate our momentum to close our proposed combination with Willis Towers Watson.

“These are very capable teams that have demonstrated exceptional dedication to our clients and our firm. I want to recognize their contributions and reinforce that we are confident they will have similar opportunities with Aquiline and Alight.”

The US retirement business being sold to private investment firm Aquiline Capital Partners includes nearly 1,000 employees. The agreement covers US core retirement consulting, US pension administration, and the US-based part of Aon’s international retirement consulting business plus many solutions and tools that include Benefit Index and SpecSelect, Risk Analyzer, DBCalc and YPR, and Aon Pooled Employer Plan (PEP).

The deal with Aquiline Capital Partners excludes Aon’s non-US actuarial, non-US pension administration or international retirement businesses operating outside of the US.

Aon to sell US retirement business and Aon Retiree Health Exchange for $1.4bn. Photo courtesy of Ken Lund from Reno, Nevada, USA/Wikimedia Commons.

Jeff Greenberg – Aquiline Capital Partners Chairman and CEO said: “The retirement solutions sector is benefitting from an increased focus on long-term investment security and risk management of plans.

“Aquiline’s significant experience across retirement and investments positions us to build on the strong business Aon has created. We look forward to working closely with the clients, management and colleagues of Aon’s U.S. retirement business to create further value for all stakeholders.”

On the other hand, the Aon Retiree Health Exchange, which is being acquired by Alight Solutions, is an individual market solution that supports employers and their retirees.

As part of their efforts to get regulatory approvals for their merger, Aon and Willis Towers Watson had previously announced the sale of Willis Re, a set of the latter’s corporate risk and broking and health and benefits services, and the former’s German retirement and investment business.

Aon said that all of the regulatory divestitures taken up are subject to the completion of its pending merger with Willis Towers Watson and other customary closing conditions.

The merger is expected to close during the third quarter of 2021, subject to the necessary regulatory approvals and clearances among others.