Aon Plc has initiated a substantial US investment-grade debt offering, seeking to raise $13.5 billion through a seven-part bond sale. This move is part of the funding strategy for its planned $17 billion acquisition of USI Insurance Services, currently owned by private equity firm KKR & Co. The overall financing package for the acquisition may also include a $4 billion term loan, according to S&P Global Ratings.
The acquisition aims to expand Aon's presence in the insurance distribution market, particularly targeting the US middle-market. USI, as of June 30, 2026, generated $756 million in adjusted EBITDA and recorded approximately $3 billion in annual revenue in 2025, placing $11 billion in property and casualty premiums. The transaction will also involve repaying USI's existing debt, estimated at $4.3 billion as of June 30, 2026.
The bond offering is structured as a multi-tranche deal, a common approach for issuers to build a curve across various maturities, often for funding acquisitions or general corporate purposes. Analysts view Aon's debt as a high-quality benchmark-adjacent credit, suggesting that the offering is likely to be well-absorbed by the market. However, market observers will be scrutinizing the stated use of proceeds, the concession offered compared to existing curves, and final book metrics to differentiate it from routine liability management.
Following the acquisition and related financing, Aon intends to focus on deleveraging, targeting a leverage ratio of 2.8:1 to 3.0:1 (total indebtedness to trailing 12-month EBITDA) within approximately 24 months. For the twelve months ending June 30, 2026, the combined adjusted EBITDA for Aon and USI was approximately $6.7 billion. TD Cowen maintained a "Buy" rating on Aon and raised its price target to $420 from $416, indicating confidence in the company's strategy.
