Aon Nears $17 Billion Deal to Buy USI Insurance From KKR

Aon is reportedly nearing an agreement to acquire USI Insurance Services from private equity giant KKR in a transaction valued at approximately $17 billion, including debt, potentially expanding the insurance broker’s presence in the U.S. middle market.

The deal could be announced as early as Monday, the Wall Street Journal reported on Sunday, citing people familiar with the negotiations. USI Insurance is headquartered in Valhalla, New York, and generates roughly $3 billion in annual revenue.

At the reported $17 billion valuation, Aon would be paying about 5.7 times USI’s annual sales. Aon, which trades on the New York Stock Exchange under the ticker AON, had a market capitalization of around $75 billion based on Friday’s closing price.

The potential USI Insurance acquisition would deliver a major return for KKR. The private equity firm and Canadian pension investor CDPQ acquired USI from Onex in 2017 for approximately $4.3 billion. KKR subsequently invested additional capital in the insurance brokerage, increasing its ownership and becoming USI’s largest shareholder.

For Aon, buying USI would further strengthen a strategy focused on expanding its middle-market insurance brokerage operations. In 2024, Aon completed its acquisition of NFP, a middle-market property and casualty insurance broker, for approximately $13 billion in cash and stock. NFP was previously backed by Madison Dearborn Partners and HPS Investment Partners.

Aon has pursued major consolidation opportunities before. Its planned merger with Willis Towers Watson collapsed in 2021 after facing antitrust opposition from the U.S. Department of Justice.

The latest potential acquisition comes as analysts remain cautious about Aon’s near-term outlook. RBC Capital Markets currently maintains a Sector Perform rating on Aon shares and recently lowered its price target.

For KKR, a USI sale would also fit its broader capital-recycling strategy following years of value creation at the insurance brokerage. The investment firm has remained active in private equity markets and previously closed KKR North America Fund XIV with approximately $23 billion in commitments.