U.S. judge narrows focus of antitrust suit over $30 bln Aon-Willis merger

July 21, 2021

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NEW YORK, July 21 (Reuters) - A federal judge has narrowed the scope of a U.S. Department of Justice lawsuit blocking the proposed $30 billion merger of insurance brokers Aon PLC (AON.N) and Willis Towers Watson PLC (WTY.F), allowing the companies to finalize remedies for three of five issues raised by the antitrust regulator.

The impending trial on the remaining issues, set to start in November, will focus on whether large U.S. businesses would face diminished competition when seeking two categories of insurance: property, casualty and financial risk coverage; and health-and-benefit coverage for employees, according to an order signed by U.S. District Judge Reggie Walton on Tuesday.

Walton set trial dates in the case earlier this month. The DOJ filed its suit in June. read more

Aon, Willis and the DOJ declined to comment.

Aon ranks second and Willis fifth among U.S. commercial insurance brokers in the U.S. market, according to a survey by Business Insurance magazine. The other largest brokers in the United States are Marsh & McLennan Companies (MMC.N), Arthur J Gallagher & Co (AJG.N) and Alliant Insurance Services Inc.

The narrowing of the DOJ's case comes after Aon and Willis agreed to divestitures to win approval in the United States and Europe after discussions with regulators.

The divestitures include Aon's U.S. retirement unit, U.S. retiree healthcare exchange and retirement business in Germany. Also included is Willis Towers Watson's global reinsurance business. EU antitrust regulators approved the merger earlier this month conditioned on some of the sales. read more

The DOJ had alleged that combining the two large insurance brokers would harm competition in reinsurance broking, retirement and pension planning and private retiree multicarrier healthcare exchanges. But the divestitures mean those no longer will be issues in the trial, according to the order.

Additional reporting by Diane Bartz in Washington; Editing by Sandra Maler