US merger for Towers Perrin, Watson Wyatt
CONSULTING firms Towers Perrin Forster & Crosby and Watson Wyatt Worldwide plan to merge in an all-stock deal valued at about $3.5bn (£2.1bn), as they hope to cut costs amid an economic slump that caused clients to curb discretionary spending.
Under terms of the deal, announced yesterday, Watson Wyatt’s shareholders will get half of the shares in the new company, while Towers Perrin, which is not listed, will distribute the other half between its investors and some employees.
Stock in Watson Wyatt was down 7.5 per cent to $38.11 in afternoon trading.
Watson Wyatt chief executive John Haley will be chairman and chief executive of the combined company. Watson’s chief financial officer Roger Millay will hold the same title at the new company. Towers Perrin’s chief executive Mark Mactas will serve as president and chief operating officer of the new company.
The companies expect to save $80m a year within three years through synergies but declined to comment on job cuts.
Watson Wyatt has 7,700 staff, 3,000 of which are in Europe, mostly in the UK where the company is well known as an investment consultant.