Aon announces it will purchase rival insurance broker USI to build what CEO Greg Case calls the "premiere middle market platform." Premiere means first. Aon is already the largest insurance broker on earth. The thing they're building already exists. It's them.
Case used the word "build" like he's assembling furniture. He's buying a competitor. That's not building. That's shopping. Jeff Bezos doesn't say he built a grocery store when he bought Whole Foods. He says he bought Whole Foods because he's not a f*cking liar.
The middle market platform will serve mid-sized businesses. Those businesses already have insurance brokers. They're called Aon and USI. After the merger, they'll have one insurance broker. That broker will be called Aon. The platform will be exactly as premiere as it was yesterday, except now there's less competition.
Retail traders hear "premiere middle market platform" and think it's a moat. It's not a moat. It's a press release written by someone who gets paid to make "we bought our competitor" sound like innovation. The stock doesn't care. The chart doesn't care. The merger will close in eighteen months and the stock will trade exactly where the Fed wants it to trade.
Some analyst at Jefferies will publish a note saying the deal creates synergies. Synergies means firing people. The premiere platform will have fewer employees and higher margins. Case will get a bonus. USI's CEO will get a golden parachute. The middle market will get the same insurance at the same price from fewer people.
None of this changes the trend. None of this changes support. If you bought Aon because they're building a premiere platform, you didn't buy Aon because of the chart. You bought a press release, and press releases expire worthless.
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