Aon M&A Exec: Merger Consolidates M&A Operations Under Single Roof

Aon Corp. has consolidated its merger and acquisition capabilities under the umbrella of a new unit that will be called Aon M&A Solutions.

Mergers and acquisitions had been handled by both Aon Risk Solutions and Aon Hewitt, which formed in the wake of Aon's $4.9 billion merger with Hewitt Associates.

The global broker said it believes the consolidation will leave it positioned for what it views as the potential for increased activity in the mergers and acquisition space.

"We've been working on how to integrate internally for probably five months," said Brian Casey, an executive vice president who will serve as co-global practice leader for Aon M&A Solutions. "So what we're really doing is integrating across business units so there are no barriers to bringing the best of people-consulting or risk-consulting to a client."

Casey comes to the new unit from Aon Risk Solutions. The other co-global practice leader is Aon Hewitt's Mark Arian.

Casey said Hewitt Associates had developed over the decades depth in organizational strategy, integration, benefits consulting and benefits administration outsourcing, talent management and change management. By comparison, he said Aon Risk's focus was geared more toward the financial insurance risk management aspect of mergers and acquisitions, "not only at the time of acquisition, but also helping our clients build value in those companies over the life cycle."

Casey's optimistic outlook for the new group is driven by a statistic that Aon cited from an October article in Bloomberg BusinessWeek that said the world's 1,000 largest nonfinancial companies have nearly $3 trillion in corporate funds on their balance sheets.

"Industry pundits have been forecasting that 2011 will be the busiest, largest M&A year in the last decade," Casey said.

About 100 full-time employees will work in the new unit; Casey said they are already looking to add positions.

Shortly after the October merger, Aon announced plans to cut 1,500 to 1,800 positions globally to save an expected $355 million in 2013 as part of a three-year restructuring plan (BestWire, Oct. 14, 2010).

With $7.6 billion in annual revenue for 2009, Aon Corp. was the second-largest global broker, behind Marsh & McLennan Cos., which had $10.5 billion in total revenue, as ranked by Best's Review. In the previous year, Aon had been the top global broker, based on brokerage revenue.

Shares of Aon (NYSE: AON) were trading at $45.74 a share the afternoon of Jan. 31</chron>, up 0.93% from the previous close.

(By Al Slavin, senior associate editor, BestWeek)