Hewitt Associates, Inc. to Merge with Aon Corporation
Aon Corporation (NYSE: AON) and Hewitt Associates, Inc. (NYSE: HEW) announced today that the boards of directors of both companies have approved a definitive agreement under which Hewitt will merge with a subsidiary of Aon. The aggregate consideration is valued at $50 per Hewitt share, which represents a 41% premium to Hewitt’s closing stock price on July 9, 2010, the last trading day prior to the announcement of the agreement. The aggregate fully diluted equity value of the transaction is approximately $4.9 billion, consisting of 50% cash and 50% Aon stock (based on the closing price of Aon common stock on July 9, 2010).
Following the close of the transaction, Aon intends to integrate Hewitt with its existing consulting and outsourcing operations (Aon Consulting) and operate the segment globally under the newly created Aon Hewitt brand. In addition, Russ Fradin, chairman and chief executive officer of Hewitt, will serve as chairman and chief executive officer of Aon Hewitt, reporting to Greg Case, chief executive officer, Aon Corporation.
Hewitt is one of the world’s leading HR consulting and outsourcing companies. Hewitt helps more than 3,000 clients and their employees around the world anticipate and solve their most complex benefits, talent, and related financial challenges through three primary business lines: consulting, benefits outsourcing and HR business process outsourcing. Hewitt, combined with Aon Consulting, will build upon those strengths, creating a global leader in human capital solutions, with diverse product and service capabilities and world-class associates to effectively serve clients’ evolving needs.
“This agreement reflects our ongoing efforts to ensure that Aon’s associates, capabilities and technology remain at the forefront of our industry, providing distinctive client value,” said Case. ”As we continue to grow our business, this merger will give us a broader portfolio of innovative products and services focused on what we believe are two of the most important topics in the global economy today – risk and people.”
Case continued, “Aon and Hewitt share a focus on excellence in client service and recognize the importance of talent in our industry. A leading portfolio of client services and strong cultural fit will enable us to quickly realize the benefits of this transaction, and the value added for our clients, our associates and our stockholders.”
“We are extremely excited to join forces with another iconic global brand to form the leading human capital services enterprise,” commented Fradin. “This combination allows us to provide even more services for our clients and greater opportunities for our associates. Aon and Hewitt share a relentless commitment to our clients and to the associates who serve them.”
An integration team led by Greg Besio (chief administrative officer, Aon) will commence planning for a strong transition. The team is comprised of leaders across Aon and Hewitt and includes: Kristi Savacool (senior vice president, Hewitt Large Markets Benefits Outsourcing), Jim Konieczny (president, Hewitt HR Business Process Outsourcing), Yvan Legris (president, Hewitt Consulting) and Kathryn Hayley (co-chief executive officer, Aon Consulting).