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Aon to Acquire USI Insurance From KKR in $17 Billion Deal; Shares Decline
Aon plc (NYSE:AON) announced on Monday it will acquire USI Insurance Services from private equity firm KKR & Co. (NYSE:KKR) in a transaction valued at approximately $17 billion, including debt. The major acquisition, which confirms earlier media reports, prompted a negative reaction in Aon's stock during premarket trading.
Deal Structure and Rationale
The companies officially announced the deal Monday, following a Sunday report from The Wall Street Journal that a transaction was imminent. USI, a Valhalla, N.Y.-based insurance brokerage and consulting firm, generates around $3 billion in annual revenue, according to its website.
Aon stated that the acquisition is intended to expand its service capabilities for midsize businesses. The global professional services firm projects that the deal will be accretive to its earnings per share by 2028.
AdMarket Reaction and Context
Following the news, shares of Aon dropped 1.8% in Monday's premarket session. The transaction represents a significant exit for KKR, which is working through a backlog of assets amid a shifting private-equity landscape.
KKR, along with Canadian investment firm CDPQ, first acquired USI from private-equity firm Onex in 2017 for $4.3 billion. KKR has since made additional investments to become the company's largest shareholder. The sale aligns with KKR's recent activity, as the firm reported its best-ever quarterly asset sales of $1.29 billion in the latest period.
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