GLOBAL - Aon Corporation has announced it has completed its merger of Hewitt Associates with Aon Consulting to create Aon Hewitt.
The firm said the combined firm would have revenues of $4.3bn and a workforce of 29,000 globally.
It said combined revenues for the 2009 accounting year consist of 49% from consulting services, 40% from benefits administration and 11% from human resource business process outsourcing.
Aon said the combined firm would have a complementary product and service portfolio across consulting, benefits administration and HR business process outsourcing - a product portfolio that it said would provide for significant cross-sell opportunities, including the marketing of Hewitt's benefits administration and HR business process outsourcing services to Aon's clients, as well as the marketing of Aon's risk services product portfolio to Hewitt's clients.
It said the combined client base would also provide significant cross-sell opportunities to leverage Hewitt's predominantly large corporate client base with Aon's predominantly middle market client base.
Aon said the merger was expected to generate approximately $355m in annual cost savings across Aon Hewitt in 2013 - primarily from reduction in back-office areas, public company costs, management overlap and leverage of technology platforms.
It said it hoped to achieve a long-term operating margin in Aon Hewitt of 20% - primarily through anticipated synergies, greater economies of scale and improved operational performance.
In total, Aon said the strong cash flow generation of Hewitt, combined with expected synergies from the combination, are expected to deliver $1.5bn of value creation for shareholders on a discounted cash flow basis, after subtracting the purchase price of the transaction.
Aon president and chief executive officer Greg Case said: "Through Aon Hewitt, we will provide our clients with a broader portfolio of innovative products and services focused on what we believe are two of the most important topics facing today's global economy - risk and people."
Aon Hewitt chairman and chief executive officer Russ Fradin added: "Our focus remains constant-to serve clients exceptionally well every day. Clients can be confident Aon Hewitt has the expertise and experience to serve as a true partner, helping them with their most pressing business challenges."
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