November 23, 2015 by Canadian Underwriter
Global professional services company Towers Watson announced on Monday that it has issued a letter to stockholders urging them to support the merger with Willis Group Holdings.
Last week, Willis announced that it had adjourned an Extraordinary General Meeting on the proposed merger. This followed Towers Watson’s decision to adjourn a Special Meeting of stockholders to provide additional time for its shareholders to vote.
On Friday, Towers Watson announced an amended merger agreement with Willis, Towers Watson noted in a press release on Monday. Under the terms of the amended agreement, which was unanimously approved by the Towers Watson board of directors, the one-time cash dividend to be paid to Towers Watson stockholders will be increased to $10 per Towers Watson share. Towers Watson said in the release that “it does not expect any further increase in the pre-merger special dividend and Willis has stated it will not agree to any further increase.”
Towers Watson has adjourned the special meeting until Dec. 11 to allow stockholders additional time to evaluate the amended merger agreement. Towers Watson stockholders of record as of the close of business on Oct. 1 will be entitled to vote at the special meeting.
“Following the merger, Towers Watson stockholders will have an approximately 49.9% ownership interest in a leading integrated global advisory, broking and solutions firm that is expected to deliver approximately US$4.7 billion in total incremental value to stockholders through a combination of cost savings, revenue synergies and tax efficiencies,” the letter said.
The combined company is also expected to generate between US$375 and US$675 million in incremental annual revenue in its healthcare exchange, large market property & casualty insurance broking, and global benefits consulting business. The companies also project annual cost savings of between US$100 and US$125 million, and a further US$75 million in annual tax savings.
The Towers Watson board “remains confident the Towers Watson/Willis merger is in the best interest of all stockholders and unanimously recommends that you vote “FOR” the approval and adoption of the amended merger agreement and related proposals,” the letter said, adding that not voting or abstaining will have the same effect as a vote against the merger.
The full text of the letter to Towers Watson stockholders can be viewed at http://willisandtowerswatson.mergerannouncement.com/letters-to-shareholders/.