(Reuters) - Aon Plc said on Tuesday it is in early stages of considering an offer for rival insurance brokerage Willis Towers Watson Plc.
The potential all-stock transaction is at a preliminary stage and there is no certainty that it will take place, Aon said.
Willis Towers was not available for comment.
Shares of Willis Towers closed 5.2 percent higher at $182.04, while Aon fell 7.8 percent to $157.25.
As of March 4, Aon was valued at $40.95 billion, while Willis Towers’ market value stood at $22.34 billion.
Willis Towers owns Chicago’s Willis Tower, formerly known as the Sears Tower, which is the second highest building in the United States and was the world’s tallest for some time.
Insurers are increasingly divesting non-core parts of their business, putting valuable assets out on the market, a report by Willis Towers and Mergermarket showed in October.
Global insurance mergers and acquisitions jumped to 37 billion euros in the first six months of 2018, the highest first-half total since the financial crisis, the October report said reut.rs/2H0vvI9.
In September, U.S. financial services group Marsh & McLennan Companies Inc agreed to buy Jardine Lloyd Thompson, valuing the British insurance and reinsurance broker at about 4.3 billion pounds.
The Aon-Willis merger could be the largest among insurance brokers amid volatility surrounding Britain’s impending exit from the European Union and trade tensions between Beijing and Washington threatening appetites.
Earlier on Tuesday, Bloomberg reported about the potential deal.
Willis Group Holdings, the world’s oldest insurance broker, merged with human resources consultancy Towers Watson & Co in 2016. The deal allowed Willis to better compete with now potential acquirer Aon and rival Marsh & McLennan Co.
(This story corrects headline and first paragraph to say Aon is in early stages of considering an offer, not that it is in early talks to buy)
Reporting by Diptendu Lahiri in Bengaluru; Editing by Shinjini Ganguli and Maju Samuel