Willis Towers Watson (WTW) has agreed to sell its reinsurance arm, Willis Re, to Arthur J. Gallagher & Co for $3.25bn (£2.35bn), subject to regulatory approvals and clearances.

The transaction is expected to be completed no later than the first quarter of 2022 and comes just weeks after WTW’s proposed merger with Aon was terminated following an “impasse” with the US Department of Justice.

The global advisory, broking and solutions company said the Willis Re deal also included an earnout payable in 2025 of up to $750m (£542.6m) in cash, subject to certain adjustments.

WTW CEO, John Haley, CEO, commented that the collapse of the deal with Aon had led the business to take time “to reflect on what we have learned about WTW over the last 16 months and determine how we will move forward”, with this including a “review of strategic alternatives for Willis Re”.

He continued: “While we highly value Willis Re and our colleagues who contribute to its success, we concluded that divestment was the appropriate path for this business and for WTW.

“We are excited about our go forward portfolio of businesses and believe we are well positioned to compete vigorously around the world and make investments to grow organically and inorganically.

“We are winning new business, bringing the best to our clients and actively engaging and recruiting talent. And, we are going to continue to innovate and adapt to address evolving client needs. We look forward to sharing more about our future plans during our upcoming Investor Day on 9 September.”

Share Story: