CMA clears Gallagher's acquisition of WTW's reinsurance arm

The Competition and Markets Authority (CMA) has closed its probe into Arthur J. Gallagher & Co.’s (Gallagher) bid to acquire Willis Tower Watson’s (WTW) treaty reinsurance business, clearing the way for the deal to proceed.

The UK antitrust watchdog said it has decided not to push through with the next stage of its investigation based on the information it currently had.

The decision comes months after Gallagher announced an agreement to acquire WTW’s reinsurance arm Willis Re for US$3.25 billion (about £2.42 billion).

Read more: Gallagher strikes multi-billion-dollar deal to acquire WTW assets

Following the announcement, the CMA opened an inquiry into the merger on 4 October.

The deal also followed the US Department of Justice’s move blocking a US$30 billion (about £22 billion) mega-merger between WTW and Aon Plc, which would have created the world’s largest insurance brokerage, citing competition issues.

Read more: Regulatory issues in Aon-WTW mega-merger should concern brokers

“The CMA has cleared the anticipated acquisition by Arthur J. Gallagher & Co. of the treaty reinsurance business of Willis Towers Watson,” the watchdog said on its website, adding that full details of the decision will be published shortly.

The decision is another crucial step towards the completion of the deal, which will see Gallagher expand its reinsurance brokerage reach. The transaction is anticipated to close no later than the end of the first quarter of 2022, subject to regulatory approvals.