Arthur J. Gallagher/WTW (Treaty Reinsurance business) merger inquiry

WTW, which was due to undergo a $30bn (£22bn) merger with Aon until a protracted dispute with the US Department of Justice brought an end to the deal in July, announced in August its decision to sell Willis Re to Gallagher, divesting the business for a total upfront cash consideration of $3.25bn plus an earn-out payable in 2025 of up to $750m in cash, subject to certain adjustments.

John Haley, WTW chief executive, said at the time of the announcement: “Following the termination of the proposed combination with Aon, we have been taking time to reflect on what we have learnt about WTW over the past 16 months and determine how we will move forward as an independent company. 

“As part of this, we conducted a review of strategic alternatives for Willis Re, our global reinsurance business. 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.”

The deal is expected to close in no later than the first quarter of 2022, but was always subject to regulatory approval. Now, the CMA has announced an investigation into the proposed merger to see whether it complies with the Enterprise Act 2002.

The CMA issued its commencement notice on Tuesday, and is investigating whether the merger “may be expected to result in a substantial lessening of competition within any market or markets in the UK for goods or services”, it said.

The regulator is inviting comments from “interested parties”, with the deadline for submission falling on October 19. The deadline for its phase one decision is November 29.