8-KMaterial AgreementsExhibits & Filings

Aon plc 8-K Report, Material Agreement (Jul 12, 2010)

Filed July 12, 2010For Securities:AON

Summary

This 8-K filing from Aon plc, dated July 11, 2010, announces a material definitive agreement for the acquisition of Hewitt Associates, Inc. The transaction is structured as a merger with two stages, ultimately making Hewitt a wholly owned subsidiary of Aon. The deal is expected to be tax-free for U.S. federal income tax purposes and will involve a mixed consideration for Hewitt shareholders, consisting of Aon common stock and cash, with an approximate 50/50 split between equity and cash. The acquisition significantly expands Aon's business and includes provisions for the integration of leadership, with two new directors from Hewitt expected to join Aon's board. Aon has secured committed financing for the transaction, including a $1.0 billion term loan facility and a $1.5 billion bridge facility, to fund the cash portion of the merger, refinance existing debt, and cover related expenses. The filing also outlines various closing conditions, termination rights with associated fees, and provides important information for investors regarding the upcoming joint proxy statement/prospectus.

Key Highlights

  • 1Aon Corporation has entered into an Agreement and Plan of Merger to acquire Hewitt Associates, Inc.
  • 2The transaction is structured as a two-step merger, with Hewitt becoming a wholly owned subsidiary of Aon.
  • 3Hewitt shareholders will receive a mixed consideration, comprising Aon common stock and cash, with an approximate 50/50 split.
  • 4Unvested Hewitt stock options will fully vest and be converted into Aon stock options.
  • 5Aon has secured $2.5 billion in committed financing through a term loan and bridge facility to fund the acquisition.
  • 6The merger requires approval from both Aon and Hewitt stockholders, as well as regulatory approvals.
  • 7The transaction is intended to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code.

Frequently Asked Questions

This 8-K filing announces Aon plc's entry into a material definitive agreement to acquire Hewitt Associates, Inc. It details the terms of the merger agreement, the consideration to be paid to Hewitt shareholders, the financing arrangements for the acquisition, and the conditions for closing the transaction.

Hewitt shareholders will receive a mixed consideration for their shares. They can elect to receive either a combination of Aon common stock and cash, an all-cash amount, or an all-stock amount. However, the total cash and stock paid will be adjusted to maintain an approximate 50/50 split of the aggregate merger consideration. Holders who do not make an election will receive the mixed consideration.

Aon has secured committed financing totaling $2.5 billion. This includes a $1.0 billion unsecured term loan facility and a $1.5 billion unsecured bridge facility, provided by Credit Suisse and Morgan Stanley. The proceeds will be used to pay a portion of the cash consideration, refinance existing Hewitt debt, and cover associated fees and expenses.

The closing of the merger is subject to several conditions, including the approval of the merger agreement by Hewitt stockholders, the approval of the stock issuance by Aon stockholders, the expiration of antitrust waiting periods (Hart-Scott-Rodino) and other regulatory approvals, the absence of any court orders prohibiting the transaction, receipt of tax opinions, limitations on Hewitt shareholder appraisal rights (not exceeding 12.5%), and the accuracy of representations and warranties made by both parties.