Aon’s Failed Deal Highlight’s Biden’s Aggressive Antitrust Approach

Aon’s abandoned deal could be a sign of things to come.


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Aon’s abandoned deal with Willis Towers Watson may be a sign of things to come.Credit…M. Spencer Green/Associated Press

Tough talk on antitrust

In the Biden administration’s first major antitrust action, the government scored a victory simply by showing a willingness to fight. Aon called off its proposed $30 billion takeover of the rival insurer Willis Towers Watson yesterday, citing delays stemming from a lawsuit brought just over a month ago by the Justice Department to block the deal, which was first announced in March last year.

“This is a victory for competition and for American businesses,” Attorney General Merrick Garland said in a statement after the deal was scrapped. The government argued that merging two of the three biggest insurance brokers would “likely lead to higher prices and less innovation.” The companies countered that the government didn’t understand their businesses.

“We reached an impasse,” Greg Case, Aon’s C.E.O., said in a statement. Aon had angled for a summer trial while the Justice Department suggested winter next year. The judge set a November date, but warned of delays; Aon decided that instead of digging in, it would pay a $1 billion termination fee to Willis and move on.

Tough talk can make big deals less appealing, former antitrust officials told DealBook. “The risk and time delays of a merger challenge often cause the parties to abandon a deal,” said Doug Melamed, a Stanford law professor and former acting chief of the Justice Department’s antitrust division. President Biden’s pledge to rein in corporate power with more aggressive antitrust enforcement efforts, backed by a team of Big Tech critics, is limited by existing laws. Aon’s move highlights how trustbusters can have their way by other means.

And even if the government doesn’t win every case it brings, the signals it sends about scrutinizing mergers more closely have been received by deal makers, who are otherwise having a very busy year. (One of the busiest on record, in fact.)

Filing lawsuits is one thing, but going through with litigation is another, because “the courts are generally very conservative about antitrust matters,” Melamed said. A case in point: The F.T.C.’s antitrust matter against Facebook was dismissed by a judge who said the government hadn’t properly defined the personal social networking market, much less showed that Facebook monopolized it. (The agency recently received a three-week extension to amend its complaint.) And deep-pocketed tech giants — a priority for the administration’s antitrust efforts — might not back down from legal challenges quite as readily as insurers.



Tesla’s quarterly profit surpasses $1 billion for the first time. That was well above what analysts were expecting, as the electric-car maker’s sales more than doubled from a year ago. But Elon Musk once again delayed the company’s anticipated truck rollout, and warned that a shortage of chips would slow sales for the rest of the year.

Senators continue to struggle with a bipartisan infrastructure bill. Lawmakers blew through another self-imposed deadline yesterday, unable to reach agreement on the $1 trillion package, namely how to pay for it. Negotiators said they remained optimistic, but Democrats’ patience is wearing thin.

Bitcoin continues to swing on Amazon rumors. The e-commerce giant denied reports that it was about to accept crypto payments, which briefly pushed Bitcoin’s price above $40,000. Lawmakers in the House and Senate will hold hearings today on the benefits and risks of cryptocurrency, amid reports that the Justice Department is investigating executives at Tether, which plays a key role in crypto trading.

China adds another sector to its business crackdown. Shares in Meituan, a leader in the food-delivery sector, dropped for a second day after regulators ordered the industry to ensure workers earned a local minimum wage. Amid Beijing’s efforts to rein in a wide range of companies, an S.E.C. commissioner said that U.S.-listed Chinese firms should disclose the risks of government interference. (The influential investor Cathie Wood is dumping her firm’s stakes in Chinese companies.)

Countries split on pandemic travel restrictions. On the one hand, Britain is weighing making it easier for European and American travelers to enter, hoping to bolster its tourism industry. On the other, the U.S. will continue to restrict access to Europeans, citing the Delta variant.


Hank Paulson’s big new climate fund

When Bono helped recruit the former Treasury secretary and Goldman Sachs chief Hank Paulson to join TPG’s impact investing initiative, part of the pitch was that a private equity fund focused on fighting climate change could be big. He was right.

The TPG Rise Climate fund will announce today that it has raised nearly $5.5 billion in its first investment round, which would make it the largest climate-focused fund in the world. The fund, which counts the TPG co-founder Jim Coulter as its managing partner, would rank as the 25th-largest private equity fund out of more than 1,200 raised this year, according to PitchBook. It has a cap of $7 billion, so it could get bigger.

Unusually, Rise Climate’s investors aren’t simply the big pension funds. Investors include Apple, General Motors, Nike, FedEx, Honeywell and roughly three dozen other large corporations, which collectively are contributing about $1 billion. Corporations rarely invest in private equity funds, so their participation underscores the demand by both investors and companies to find climate solutions.

The companies that invested in the fund will most likely have access to many of the businesses that TPG invests in, helping them grow, and potentially validating them. TPG said Rise Climate would be focused on companies that can “enable carbon aversion in a measurable way.”

Earlier this year, Paulson told Andrew that for a fund focused on sustainability to sustain itself, it had to produce returns that were competitive with other private equity investments. “The market will not scale for concessionary or subsidized returns,” he said. He will have to prove the returns, but so far scale does not seem to be a challenge.

“If you have any interest in investor protection or in fair, orderly, and efficient markets, then shoot me a follow.”

— The S.E.C. chair Gary Gensler’s first tweet. Speaking of markets, he joined Twitter just in time to weigh in on Robinhood’s I.P.O. later this week.

Governments take the lead on vaccine mandates

With coronavirus case counts rising, officials are imposing vaccine mandates on government workers in hopes that the private sector will follow suit. “Right now, what we’re saying is we’re leading by example,” Mayor Bill de Blasio of New York said yesterday. “A lot of times, private sector employers say that’s what they need.” Here is what some government leaders announced yesterday, and how companies responded (or didn’t):

The Department of Veterans Affairs became the first federal agency to require Covid vaccinations for all 115,000 of its frontline health care workers.

California is mandating vaccines or testing for state government workers. The mandate will cover 246,000 employees, plus hundreds of thousands of health care workers in the public and private sectors. After the announcement, Oakland’s Kaiser Permanente said it supported the governor’s decision and would require all of its employees nationwide to get vaccinated or tested regularly.

New York City is mandating vaccines or testing for all municipal employees. The order affects roughly 340,000 workers, including teachers and police officers. Representatives for the Wall Street giants Goldman Sachs and JPMorgan Chase declined to comment. Facebook, which has 4,000 employees at its New York office, said that it would continue to encourage, rather than require, vaccination.


The new generational divide

Younger workers are more likely than their older colleagues to prefer working from home, The Times’s Nelson Schwartz and Coral Murphy Marcos wrote yesterday. How companies should address this emerging generation gap struck a chord with readers, with more than 1,700 comments. Some edited highlights from the discussion:

The office isn’t productive: “All of those bosses that shoved people into those godawful cubicles have no idea how unproductive the current office is. I would spend 70 hours in the office to get 20 hours of work done.”

Kids these days: “Does anyone need a better example of the ‘You still get a trophy just for participating’ generations? They grew up believing they were special, and they laughably believe it. They think they’re irreplaceable.”

Remote work is more equal: “I think going virtual instead of in-person levels the field for women and minorities who do not often get this kind of friendly water-cooler mentoring, but more scrutiny and judgment when appearing in person.”

The office is easier for the wealthy: “With housing and cost of living being disturbingly expensive in high-opportunity urban cores, people who already have money can afford to live closer to where the high-paying jobs are. Others are forced into an impossible trade-off between housing they can barely afford moneywise and a commute they can barely afford timewise.”

Working remotely is easier for the wealthy: “Working at home is great for everyone who can afford great Wi-Fi, has quiet space away from roommates and/or family, who can pay for day care for their kids, who doesn’t need informal training or mentoring, who knows their organization well, and otherwise has all the rank and privileges of the educated and experienced middle class.”

Read the full story (and leave a comment): “Return to Office Hits a Snag: Young Resisters




Lordstown Motors, the embattled electric-vehicle maker, said that it would raise up to $400 million from a hedge fund. (NYT)

In SPAC news: Shares in Lucid Motors rose 11 percent in its trading debut, while investors in Bill Ackman’s SPAC are irate after its failed deal to buy a stake in Universal Music Group. (WSJ, Insider)

Investors are pouring billions into start-ups like Getir that promise to deliver groceries in as little as 10 minutes. (NYT)

Universal Pictures and Peacock are teaming up to buy a new “Exorcist” trilogy for a head-spinning $400 million. (NYT)

Silicon Valley is growing increasingly wary of Tiger Global Management. (FT)


Why Washington isn’t rushing to tamp down inflation. (NYT)

New York City officials defended canceling the Trump Organization’s contract to run a Bronx golf course by citing a loss of business after the Capitol riots. (WSJ)

The billionaire Peter Thiel is donating millions to Republican candidates for key 2022 races. (Axios)

Best of the rest

Jeff Bezos offered to cover up to $2 billion in NASA’s costs in exchange for a contract to build a lunar lander. (CNBC)

Britney Spears formally moved to have her father removed from her conservatorship. (NYT)

American workers are taking more vacation — and checking in with work less while they’re off. (Inc.)

The hottest C-Suite job is the remote work czar. (Bloomberg)

Restrictions on immigration have driven U.S. farmers to train more Americans in how to become shepherds. (NYT)


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