Industry-changing deal creates
significant additional value for both firms’ shareholders,
strengthening both beyond their powerful standalone
propositions
Willis Group Holdings (NYSE:WSH) today urged its shareholders, and
those of Towers Watson (NASDAQ:TW), to vote “FOR” the proposed
merger of equals between the two firms.
For Willis shareholders, the proposed deal further strengthens
the powerful standalone Willis value proposition. The proposed deal
enables Willis shareholders to participate in the significant
economic opportunity ($4.7 billion of estimated incremental value)
generated by the planned combination.
For Towers Watson investors, the deal accelerates the firm’s
publicly stated long-term strategy. It delivers value to Towers
Watson shareholders through clear, compelling synergies and new
client opportunities. For Towers Watson shareholders, as Towers
Watson has stated, the combination is expected to result in
projected cash net income accretion of an estimated 45% by calendar
year 20181.
This transaction was unanimously agreed upon by both boards of
directors. Willis will contribute 55.8% of the projected
combined EBITDA2 in 2016 excluding synergies, is enabling a
significant portion of the merger synergies through its Irish
domicile, and its CEO and CFO will not hold those roles in the new
company. On the day before announcement, Towers Watson
contributed 53.6% of the combined market capitalization3. Taking
both these positions into consideration, the final terms were
negotiated such that the overall economics (including the dividend
to Towers Watson shareholders) were split virtually down the
middle: 50.9% Towers Watson, 49.1% Willis. This resulted in a
modest premium to Willis’ unaffected share price, well within the
range of “merger of equals” transactions.
Willis continues to believe strongly that the combined Willis
Towers Watson will generate significantly higher shareholder
returns than either company could have generated on their own. We
urge both sets of shareholders to vote for the deal. We would also
like to refute ISS’ claim that, “Willis may have more riding on the
approval of this transaction than Towers”. As we displayed this
past quarter, we expect to continue to achieve strong growth
coupled with significant margin improvement as a result of our
operational improvement program. We remain highly confident in our
standalone plan and believe we are positioned for several years of
strong earnings growth.
Both Willis and Towers Watson investors will benefit from the
significant incremental value the two companies expect to create
together. As previously disclosed, the merger can create more than
$375 million in incremental annual revenue in the healthcare
exchange, large market property & casualty insurance broking,
and global benefits consulting business. The companies also project
approximately $100 million - $125 million in annual cost savings
and $75 million in annual tax savings.
Dominic Casserley, Willis Group Chief Executive Officer, said:
“This transaction is expected to generate significant value through
very achievable cost savings, incremental revenues and tax
benefits. Shareholders should support this deal as it will drive
value creation and accretion to earnings. Willis remains committed
to closing the transaction on the agreed terms.”
James McCann, Chairman of Willis Group, said: “At the negotiated
terms, this is a ground-breaking, strategic transaction that
enhances the competitive position and value creation potential of
both companies. We call on shareholders of both firms to support
the agreed deal.”
Willis will hold an extraordinary general meeting of its
stockholders to vote on the proposed merger with Towers Watson at
9:30 a.m. on November 18, 2015 at the Pierre Hotel, 2 East 61st
Street, New York, NY 10065. Willis stockholders of record as
of the close of business on October 2, 2015 will be entitled to
vote at the meeting. Towers Watson will hold a special meeting of
its stockholders to vote on the proposed merger with Willis at 8:00
a.m. local time on November 18, 2015 at the Royal Palm South Beach,
1545 Collins Avenue, Miami Beach, FL 33139. Towers Watson
stockholders of record as of the close of business on October 1,
2015 will be entitled to vote at the Towers Watson special
meeting.
Willis investors with questions about the transaction or how to
vote their shares may contact the firm’s proxy solicitor, Morrow
& Co, LLC at 1 (800) 278-2141. Additional information on how to
vote is available at
www.willisandtowerswatson.mergerannouncement.com.
1 See Towers Watson presentation filed with the SEC on 9th
November 2015.
2 See projections on page 108 of the S-4 regarding Towers
Watson Adjusted EBITDA and WIllis Underlying EBITDA.
3 Prior to adjustment for the pre-closing dividend to
Towers Watson shareholders.
About WillisWillis Group Holdings plc, is a
leading global risk advisory, re/insurance broking and human
capital and benefits firm. With roots dating to 1828, Willis
operates today on every continent with more than 18,000 employees
in over 400 offices. Willis offers its clients superior expertise,
teamwork, innovation and market-leading products and professional
services in risk management and transfer. Our experts rank among
the world's leading authorities on analytics, modelling and
mitigation strategies at the intersection of global commerce and
extreme events. Find more information at our Website,
www.willis.com, our leadership journal, Resilience, or our
up-to-the-minute blog on breaking news, WillisWire. Across
geographies, industries and specialisms, Willis provides its local
and multinational clients with resilience for a risky world.
Where You Can Find Additional InformationIn
connection with the proposed merger of Towers Watson and Willis
Group, Willis Group filed a registration statement on Form S-4 with
the Securities and Exchange Commission (the “Commission”) that
contains a joint proxy statement/prospectus and other relevant
documents concerning the proposed transaction. The registration
statement on Form S-4 was declared effective by the SEC
on October 13, 2015. Each of Towers Watson and Willis Group
mailed the joint proxy statement/prospectus to its respective
stockholders on or around October 13, 2015. YOU ARE URGED TO READ
THE JOINT PROXY STATEMENT/PROSPECTUS AND THE OTHER RELEVANT
DOCUMENTS THAT HAVE BEEN OR WILL BE FILED WITH THE COMMISSION AS
THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN
IMPORTANT INFORMATION ABOUT TOWERS WATSON, WILLIS GROUP AND THE
PROPOSED TRANSACTION. You may obtain the joint proxy
statement/prospectus and the other documents filed with the
Commission free of charge at the Commission’s website, www.sec.gov.
In addition, you may obtain free copies of the joint proxy
statement/prospectus and the other documents filed by Towers Watson
and Willis Group with the Commission by requesting them in writing
from Towers Watson, 901 N. Glebe Road, Arlington, VA 22203,
Attention: Investor Relations, or by telephone at (703) 258-8000,
or from Willis Group, Brookfield Place, 200 Liberty Street, 7th
Floor, New York, NY, 10281-1003, Attention: Investor Relations, or
by telephone at (212) 915-8084.
Responsibility StatementThe directors of Willis
accept responsibility for the information contained in this
document other than that relating to Towers Watson, the Towers
Watson Group and the directors of Towers Watson and members of
their immediate families, related trusts and persons connected with
them. To the best of the knowledge and belief of the directors of
Willis (who have taken all reasonable care to ensure that such is
the case) the information contained in this document for which they
accept responsibility is in accordance with the facts and does not
omit anything likely to affect the import of such information.
Forward-Looking StatementsThis document
contains “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. You can identify
these statements and other forward-looking statements in this
document by words such as “may”, “will”, “would”, “expect”,
“anticipate”, “believe”, “estimate”, “plan”, “intend”, “continue”,
or similar words, expressions or the negative of such terms or
other comparable terminology. These statements include, but are not
limited to, the benefits of the business combination transaction
involving Towers Watson and Willis Group, including the combined
company’s future financial and operating results, plans,
objectives, expectations and intentions and other statements that
are not historical facts. Such statements are based upon the
current beliefs and expectations of Towers Watson’s and Willis
Group’s management and are subject to significant risks and
uncertainties. Actual results may differ from those set forth in
the forward-looking statements. The following factors, among
others, could cause actual results to differ from those set forth
in the forward-looking statements: the ability to obtain
governmental approvals of the transaction on the proposed terms and
schedule; the failure of Towers Watson stockholders and Willis
Group shareholders to approve the transaction; the failure of the
transaction to close for any reason; the risk that the businesses
will not be integrated successfully; the risk that anticipated cost
savings and any other synergies from the transaction may not be
fully realized or may take longer to realize than expected; the
potential impact of the announcement or consummation of the
proposed transaction on relationships, including with employees,
suppliers, customers and competitors; changes in general economic,
business and political conditions, including changes in the
financial markets; significant competition; compliance with
extensive government regulation; the combined company’s ability to
make acquisitions and its ability to integrate or manage such
acquired businesses. Additional risks and factors are identified
under “Risk Factors” in Towers Watson’s Annual Report on Form 10-K
filed on August 14, 2015, which is on file with the Commission, and
under “Risk Factors” in the joint proxy statement/prospectus.
You should not rely upon forward-looking statements as
predictions of future events because these statements are based on
assumptions that may not come true and are speculative by their
nature. Neither Towers Watson or Willis Group undertakes an
obligation to update any of the forward-looking information
included in this document, whether as a result of new information,
future events, changed expectations or otherwise.
Contacts:
Media:
Miles Russell
+44 20 3124 7446
+44 7903262118
Miles.Russell@willis.com
Stephen Cohen
+1 212 886 9332
Stephen.Cohen@teneostrategy.com
Investors:
Matt Rohrmann
+1 212 915 8180
Matt.Rohrmann@Willis.com