This week, Aon announced it has signed a definitive agreement to acquire NFP, a leading middle market property & casualty broker, benefits consultant, wealth manager and retirement plan advisor.

Aon, which is the second-largest brokerage in the U.S. and reported $12.4 billion in brokerage revenue in 2022, will acquire NFP for a total estimated to be $13.4 billion. The deal will be funded by $7 billion in cash and $6.4 billion of Aon stock.

The acquisition will enhance Aon's presence in the large and fast-growing middle-market segment and add new capabilities to its arsenal.

"We have continually evolved our leading capabilities to better serve our clients' growing needs amidst increasing volatility across the marketplace," said Greg Case, CEO, Aon. "The acquisition will advance our relevance to clients, create opportunities for our colleagues and further strengthen our shared cultural values."

The last time Aon attempted to acquire a competitor, it ended in defeat as the U.S. Department of Justice ruled that their proposed acquisition of Willis Towers Watson for $30 billion in early 2020 breached antitrust laws. Ultimately, Aon had to shell out around $1.4 billion to terminate the agreement. The deal would have combined the second and third largest of the "Big Three" global insurance brokers, the DOJ said.

Founded in 1999, New York-based NFP is the 13th largest brokerage in the U.S., reporting $1.72 billion in revenue in 2022. Doug Hammond, chairman and CEO of NFP, will continue to lead the business as an independent but connected platform, going to market as "NFP, an Aon company," reporting to Eric Andersen, president of Aon.

"This is an exciting milestone in NFP's evolution that reflects the tremendous quality of the business we've built and the exceptional people who drive our success," Hammond said. "Our clients will benefit from Aon's global resources and distribution, while our people will have more opportunities to accelerate the growth of NFP."

The transaction is subject to customary conditions, including regulatory approvals, and is expected to close in mid-2024.

Will Jones is IA editor-in-chief.