AON (NYSE:AON) said it has entered a definitive agreement to acquire U.S. middle-market insurance broker USI in an all-cash transaction valued at approximately $17 billion, or $16.7 billion net of certain tax attributes. The company expects the deal to close in the fourth quarter of 2026, subject to regulatory approvals and customary closing conditions.
Greg Case, Aon’s president and chief executive officer, described the transaction as a move to establish what the company calls the premier U.S. middle-market platform. The combined operation would bring together Aon, USI and NFP, which Aon previously acquired, and expand the company’s capabilities in property and casualty, employee benefits, personal risk and retirement solutions.
Middle-Market and E&S Expansion
Aon said the transaction will deepen its presence in the U.S. middle market, which Case said represents about one-third of the U.S. commercial property-and-casualty market. The company estimated that the segment includes more than 200,000 businesses employing roughly 48 million people and represents an addressable market of more than $40 billion.
USI has approximately $11 billion of property-and-casualty premium placement and 2,800 producers, according to Aon. The combined middle-market platform is expected to generate $6.5 billion in revenue.
The acquisition also expands Aon’s direct access to the excess and surplus, or E&S, insurance market and wholesale distribution. Case said the E&S segment accounts for 26% of U.S. commercial property-and-casualty premiums and has been growing at an 18% compound annual rate. Aon said its existing direct presence in the segment has been limited largely to its Totalis Specialty business.
Andy Marcell, Aon’s deputy CEO and senior executive vice president of Risk Capital and Human Capital, said direct access to E&S markets would give clients greater choice and enable Aon to better serve specialty and wholesale-related business. He also said USI’s brokers would gain access to Aon’s global retail network, including relationships in London and Bermuda.
Financial Terms and Synergy Plans
Nadin Virani, Aon’s interim chief financial officer, said the $17 billion purchase price represents a 14.5-times synergized EBITDA multiple. Aon plans to finance the acquisition with newly issued debt across a range of maturities.
The company identified $395 million in expected adjusted EBITDA impacts from revenue and cost synergies across the full middle-market platform. Those plans include:
- $321 million in net revenue synergies across 23 work streams, translating to a projected $115 million EBITDA contribution.
- $280 million in cost synergies from 10 identified work streams, including technology integration, shared services and Aon Business Services capabilities.
- Opportunities to improve producer productivity and retention, expand cross-selling between risk capital and human capital solutions, and optimize insurance premium placement.
Virani said USI would add $3.3 billion in revenue and $1.2 billion in adjusted EBITDA on a fully synergized trailing 12-month basis. Aon expects the transaction to dilute earnings per share in 2027 before becoming accretive in 2028 and thereafter.
The company anticipates $160 million in transaction costs and $550 million in integration costs, with most integration work expected to be completed by the end of 2028. It also expects retention costs of up to $400 million over three years.
Capital Allocation and Integration
Aon said it expects to maintain its current credit ratings and return to its leverage objective of 2.8 times to 3 times approximately 24 months after closing. The company does not expect to repurchase shares in the near term as it prioritizes debt repayment, while continuing to fund a stable and growing dividend and invest in growth opportunities.
Case said the company intends to operate an integrated middle-market platform rather than treat the businesses as separate operations. He said the integration would apply lessons from Aon’s acquisition of NFP, including its approach to producer retention, technology and operating infrastructure.
Sicard said the combination would preserve the importance of producer and client relationships while adding access to a broader set of analytics, solutions and international capabilities. He described USI’s technology and data tools as complementary to Aon’s platform, particularly because USI has focused heavily on the U.S. middle market while Aon has extensive experience serving larger risk-management clients.
Case said the deal is intended to support Aon’s goal of organic revenue growth in the mid-single digits or greater over time, citing the potential to provide more solutions to existing clients, gain new clients and increase participation in the E&S market.
About AON (NYSE:AON)
Aon plc is a global professional services firm that provides a broad suite of risk, retirement and health solutions to corporations, institutions and individuals. The company operates primarily as an insurance broker and risk adviser, helping clients identify, quantify and transfer risk across property, casualty, cyber and other areas. Aon also offers reinsurance brokerage and capital market solutions that connect insurers, reinsurers and corporate buyers.
In addition to traditional brokerage activities, Aon delivers consulting and outsourcing services in areas such as human capital, benefits, and retirement plan design and administration.
