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Aon Corp.


, the world's largest insurance broker, on Friday said it would buy British reinsurance outfit

Benfield Group

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in a deal worth a total of $1.75 billion.

Aon will pay 3.50 British pounds a share, or $6.55 a share, and assume 91 million pounds, or $170 million, in Benfield debt. The sale price represents a 29% premium to Benfield's closing price Thursday on the London Stock Exchange. Aon said it would fund the deal through existing cash.

"Over the past several years, we have made significant progress in strengthening Aon's operational platform and global network, becoming a more client-focused organization with a broader portfolio of innovative products and services," Aon CEO and President Greg Case said in a company statement. "With Aon Benfield Re, we will build on this progress to further enhance organic growth, expand margins, and drive shareholder value."

After the deal's close, Benfield CEO Grahame Chilton will serve as vice chairman of Aon Group, reporting to Case, and will join the Aon Corp. executive committee and the Aon Benfield Re executive committee. Aon Re Global Executive Chairman Michael O'Halleran will serve in the same role in the combined Aon Benfield Re. Aon Re Global CEO Andrew Appel also will continue in his roll, as well as continuing to serve as chairman of Aon Consulting Worldwide.

This article was written by a staff member of