Justice Department Case Scrambles Big Bets on $33 Billion Aon-Willis Towers Deal

Traders have ratcheted up bets on the collapse of Aon PLC’s $33 billion acquisition of rival Willis Towers Watson PLC, betting the Justice Division will reach blocking the landmark insurance brokerage deal in courtroom.

The case is the Biden administration’s first massive antitrust motion and the approaching trial shall be carefully watched by Wall Avenue traders. Willis Towers’ inventory worth this week hit its largest low cost to the takeover bid for the reason that merger’s announcement final yr, indicating that traders are more and more skeptical of its completion.

Aon-Willis Towers is without doubt one of the largest offers in the universe known as merger arbitrage, the place traders guess on whether or not firm mixtures undergo. Its demise may set off a giant loss for these nonetheless anticipating its completion. However an enormous payday may very well be within the offing if they’re proper.

A number of well-known traders are uncovered to the deal, based mostly on regulatory filings this week. Corporations corresponding to Davidson Kempner Capital Administration LP, Franklin Sources Inc., Capstone Funding Advisors, Longview Companions and Eagle Capital Administration every maintain a place of greater than 1% in a single or each of the businesses.

Representatives for the fund administration firms both declined to remark or didn’t reply to a request for remark.

Source: News7 Trends