Aon announces restructuring plan

Aon Corporation has announced a global restructuring plan with projected savings of US$240 million by 2010 that includes the elimination of 2,700 positions and the outsourcing of 1,100 positions.
The announcement came on the heels of the companys 2007 Q3 results, which saw a 92% increase in profit, from US$106 million in 2006 Q3 to US$204 million in 2007 Q3.
The restructuring program will also further consolidate global human resources, finance and information technology functions and simplify real estate globally through model office practices, an Aon release says,
The plan, before any potential reinvestment of savings, is expected to deliver US$50-70 million of savings in 2008, US$175-200 million in 2009 and US$240 million of annualized savings by 2010.
In its financial report, Aon said its risk and insurance brokerage services revenue increased 7% to US$1.4 billion compared to the prior-year quarter. The companys Americas division accounted for US$582 million, representing a 3% increase over 2006 Q3.
Insurance underwriting revenue increased 21%, to US$627 million in 2007 Q3, compared to US$519 million in the prior-year quarter.
Despite soft market conditions, we are making investments that further enable us to best serve our clients, Greg Case, president and CEO of Aon Corporation, said in a statement. We are managing expenses, we announced a new restructuring program expected to deliver US$240 million of annualized savings by 2010 and we repurchased US$100 million of stock during the quarter.