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Aon's $13.4 billion buyout of insurance broker NFP on track for completion

Aon's $13.4 billion buyout of insurance broker NFP on track for completion Photo: Aon's $13.4 billion buyout of NFP on track for completion (GettyImages)

Aon, a global insurance broker, has signed an agreement to acquire NFP, a property and casualty broker and wealth manager, for an estimated $13.4 billion to expand its presence in the middle-market segment, according to PRNewswire.

The deal involves Aon purchasing NFP from its main capital sponsor, Madison Dearborn Partners (MDP), and funds affiliated with HPS Investment Partners. The agreement consists of $7 billion in cash and $6.4 billion in Aon stock.

Doug Hammond, CEO of NFP, will continue to lead the business within Aon, reporting to Eric Andersen, President of Aon.

The acquisition is aligned with Aon's strategy to enhance its services and is expected to generate substantial value creation and synergies. Financially, the transaction is predicted to impact Aon's adjusted EPS and free cash flow in the coming years, with closure subject to regulatory approvals and slated for mid-2024.

Leading provider

NFP is a prominent provider of property and casualty brokerage, benefits consulting, wealth management, and retirement plan advisory services.

With a dedicated team of over 7,700 professionals worldwide, NFP excels in delivering client solutions. They leverage cutting-edge technologies and maintain strong partnerships with top-rated insurers, vendors, and financial institutions.

NFP is recognized as the 9th top workplace for large employers in the insurance industry, the 7th largest privately-owned broker, the 7th largest benefits broker based on global revenue, and the 13th largest broker for US business, per Business Insurance rankings.

Global influence

Aon plc (NYSE: AON) is dedicated to influencing positive decisions by safeguarding and enhancing the lives of individuals worldwide. Their global team serves clients in more than 120 countries, offering guidance and solutions that empower them with the assurance and certainty needed to improve their business strategies.

Strategic acquisition

Aon's decision to acquire NFP stems from its ongoing efforts to strengthen its market position and service offerings, particularly in the middle-market segment.

This move is part of Aon's broader strategy to enhance client services amid market volatility, combining NFP's diverse business model and Aon's global resources. The acquisition reflects a strategic alignment of both companies' values and capabilities, aiming to elevate performance and benefit clients, colleagues, and shareholders.

The transaction also marks a significant phase in NFP's growth, having been developed and expanded under the stewardship of MDP and HPS Investment Partners.

Also, we recently wrote that Nippon Steel, a leading Japanese steelmaker, has announced plans to acquire American steel company U.S. Steel.