Tower Perrin and Watson Wyatt merge to form Towers WatsonConsultancy firms Towers, Perrin, Forster & Crosby and Watson Wyatt Worldwide have announced they will merge, creating a new global firm called Towers Watson & Co.
Towers Watson will focus its operations on three segments: benefits, talent and rewards, and risk and financial services. It said it will build on existing thought leadership and research, and will be supported by a more comprehensive set of services, from strategic advice to solutions and implementation.
Based on the closing price of Watson Wyatt common stock on 26 June, 2009, the implied equity value of the transaction is approximately $3.5 billion. Watson Wyatt chief executive officer John Haley will serve the combined company as chief executive officer, while Towers Perrin chief executive officer Mark Mactas will serve as president.
The firms estimated that Towers Watson, which is expected to have annual revenues in excess of $3 billion, will benefit from savings of $80 million but added that full realisation of synergies will take three years and cost approximately $80 million.
Haley said: “The combination of Towers Perrin and Watson Wyatt into Towers Watson will create one of the world’s leading professional services firms, well positioned for sustained growth and profitability across all geographies and business segments.
“The combination will further strengthen our core service lines while offering our clients an enhanced portfolio of proven offerings across a range of financial, risk and people management areas. Towers Watson will have tremendous global reach and service breadth to meet the growing needs of the world’s largest multinational corporations. As we provide more value for our clients, we in turn create value for our people and our shareholders.”