Aon will buy Hewitt for $4.9 billion [The Charlotte Observer, N.C.]

July 13--Insurance giant Aon Corp. on Monday said it agreed to buy human resources outfit Hewitt Associates for $4.9 billion in cash and stock to bulk up its consulting unit.

The Chicago-based insurance broker is paying $50 per Hewitt share, a 41 percent premium over Hewitt's closing price Friday of $35.40.

Hewitt, a Lincolnshire, Ill.-based human-resources consulting and outsourcing company, employs about 600 in North Carolina, including about 500 in Charlotte.

In April, Hewitt said it planned to add 463 positions in Charlotte over three years, enticed partly by a state jobs grant that could be worth up to $4 million.

Hewitt spokeswoman Maurissa Kanter said it was too early to say how the Aon merger might affect Charlotte expansion plans. She said both companies are committed to growing their "respective outsourcing and consulting businesses in the U.S."

Among Hewitt's clients are Charlotte-based Bank of America Corp. In April, the bank said it entered a "key" human resources relationship with the firm, which will provide administrative, payroll, recruiting and other services.

Aon expects the deal will save $355 million annually beginning in 2013. The savings will come primarily from reducing back-office areas, management overlap and public company costs and from getting more from technology platforms. It said the deal will help earnings in 2011 and 2012.

The deal is expected to close by mid-November.

Aon plans to integrate Hewitt with its existing consulting and outsourcing operations and create a new unit, Aon Hewitt, after the deal closes. Russ Fradin, chairman and chief executive officer of Hewitt, will become chairman and CEO of Aon Hewitt. Fradin will report to Aon CEO Greg Case.

Hewitt stockholders will receive $25.61 in cash and about 0.64 percent of a share in Aon stock per Hewitt share. The total payment will be $2.45 billion in cash and 64 million shares.

Hewitt shares on Monday climbed more than 32 percent to $46.79. Aon shares fell about 7 percent to $35.62.

The Associated Press contributed.

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