Aon has agreed to acquire rival USI Insurance Services from private equity firm KKR for $17 billion, marking one of the biggest insurance brokerage deals in recent years. The transaction will significantly expand Aon’s presence in the U.S. middle-market insurance segment, valued at more than $40 billion.
USI, founded in 1994, has grown into the 10th-largest U.S. insurance brokerage, generating about $3 billion in annual revenue. The acquisition will strengthen Aon’s property and casualty, employee benefits, retirement, health and human capital advisory businesses, while expanding its presence in the fast-growing excess and surplus insurance market.
For KKR, the deal marks another major exit as private equity firms increasingly monetize large investments. KKR and Caisse de dépôt et placement du Québec acquired USI for $4.3 billion in 2014, and KKR later became its largest stakeholder. KKR said the sale represents roughly a sixfold return on its 2017 investment and is expected to generate about $2 billion in adjusted profit.
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