For just under $ 5 billion, Aon Corporation is purchasing and merging with HR outsourcing and consulting firm Hewitt Associates. The combined Aon Hewitt Division will provide many of the services Hewitt did before the merger. Estimates say that the companies will save about $ 355 million a year.
Aon purchases Hewitt associates
Purchasing Hewitt Associates will end up costing Aon about $ 4.9 billion . Hewitt is going to be getting over 40 percent more per share than they are currently trading with. Aon will pay current Hewitt stockholders .63 Aon stocks and $ 25.61 per Hewitt stock. Aon offices and Hewitt offices will combine their administrative functions while maintaining separate businesses as Aon Hewitt. Hewitt Associates stock rose while Aon stock fell on this news. Illinois will play host to the new company. This merger will result in the loss of some jobs, though neither company has released official estimates on how many.
How Aon does business
Aon Corporation, among other things, works in “global risk management and insurance”. Aon offers clients advice on managing risk, along with insurance brokerage services. The company trades stock on the NYSE, and is classified as a financial business. Just one year ago, in August of 2009, Aon Corporation shed three separate insurance companies from its business model.
How Hewitt Associates operates
Hewitt Associates works with human resources outsourcing. Hewitt offers HR management, benefits, and other administrative services. A small portion of Hewitt’s business also includes consulting. Traded on the New York Stock Exchange, Hewitt is a “commercial service and supply” business. There has been some major restructuring within Hewitt Associates as well. Latin American operations have been spun off, and a company called HRAdvance Inc. was combined with Hewitt in May of 2010.
