As the co-founder and group CEO of competing London-headquartered broking group Howden, he has been a keen observer of the drawn out saga of Aon’s $30bn+ takeover of WTW which ended last week.
Looking ahead at what the future may hold for WTW during an exclusive interview on The Insurer’s Leading Voices programme, Howden reeled off what he sees as the key challenges facing his broking rival now the proposed combination with Aon has been terminated.
“The Aon share price [has] gone up, and the Willis share price has gone down,” said Howden.
“Willis is trading as low as any of the public companies by a long, long shot, so clearly the shareholders have not got significant confidence in the business compared with other businesses.”
He added: “[Also], talent is leaving Willis and will continue to leave Willis in my view because I don’t think there’s a vision that they can believe in.”
Ultimately, Howden said, “if you’re going to attract talent, retain talent and therefore attract and retain clients, you’ve got to have a story that they believe in and is for the long-term.
“And that’s the challenge that sits out there in the market for brokers that don’t have that,” he explained.
If Willis is unable to regain shareholder support and buy-in from its staff, then Howden said “very sadly we will see in some shape or another Willis disappear”.
Reflecting on the Department of Justice (DoJ)’s lawsuit blocking Aon’s acquisition of WTW, Howden said it would be “quite an irony” if Willis in its current form were to disappear.
“The regulator stepped in to try and retain Willis, and they may have mortally wounded the very animal that they wanted to save,” Howden said.
While the DoJ’s move to block Aon’s acquisition of WTW ultimately led to the deal being scrapped, Howden said it was not really the US regulator’s fault that the combination came to an end.
“A lot of people blame the DoJ, but it’s possible – and it’s not my role to protect the DoJ – that it’s not really their fault,” he said.
“It’s not like the European commissioners waved this through with a magic wand,” Howden added.
“The regulator stepped in to try and retain Willis, and they may have mortally wounded the very animal that they wanted to save”
As the long-serving industry executive highlighted, the European Commission had demanded the selling off of Willis Re, “great businesses” like the majority of WTW’s well regarded Gras Savoye unit as well as an assortment of traditionally high-margin London specialty businesses.
“I think all regulators resisted this deal,” said Howden.
Opportunity for Howden
Undoubtedly, the uncertainty the collapsed deal has created among staff – especially at WTW – has created an opportunity for Howden which has steadily been attracting more talent across the business, particularly in reinsurance.
Indeed, Howden was an active bidder for the Willis Re business before it was announced that Arthur J Gallgher had been the victor. However, this deal was built on the basis the Aon-Willis combination would go ahead. Now that it isn’t, the future of Willis Re is not clear.
While Howden did not provide any indication as to whether the group would make another play for Willis Re, he remains enthused by the talent that is already on board at Howden, and made it loud and clear during the interview that the door was open for more talented individuals to join.
“We have on-boarded hundreds, in fact thousands of people – even during Covid – and they’ve joined us for a reason. They’ve joined us because they believe in our story and they want to be empowered and they want to feel part of a business, that they are owners of and are allowed to build the business long term,” explained Howden.
“So obviously, anything that provides a push as well as what I believe we can offer, with my pure competitive hat on, bring it on, all day long,” he said.
“We’ve set our stall out, we think we’re pretty much unique, so come and join us. We’re here for the long term, nothing’s changing, so come and work for yourself – not for someone else -and come and have some fun.”