The White house on Tuesday lauded the termination of a proposed $30 billion tie-up between Aon and Willis Towers Watson that would have created the largest insurance broker in the world.
Last month, the Justice Department sued to block the all-stock deal, saying that it could eliminate competition, raise prices and hamper innovation.
And this month, President Joe Biden signed an executive order targeting what he labeled anticompetitive practices in tech, health care and other parts of the economy, declaring it would fortify an American ideal “that true capitalism depends on fair and open competition.”
“These companies provide insurance brokerage services to thousands of American businesses and charge billions a year for their services,” said White House press secretary Jen Psaki on Tuesday. “The merger would have raised prices for a wide swath of American businesses that need to use a broker to obtain insurance and benefit packages for their employees. Those higher insurance costs would ultimately have led Americans to pay more for all kinds of products and services such as banking services, hospital care, cars, and trucks.”
Psaki said the challenge to the Aon tie-up with Willis Towers Watson was “what the president was talking about when he called for more robust enforcement of the antitrust laws and his executive order to promote competition.”
Aon CEO Greg Case said in a prepared statement that the companies reached an impasse with the Justice Department and “the inability to secure an expedited resolution of the litigation brought us to this point.”
Both companies are based in London and incorporated in Ireland.
Aon PLC will pay a $1 billion termination fee to Willis Towers Watson.
Shares of Aon rose 2.8% Tuesday.