Hilb Rogal & Hobbs shareholders to decide merger with Willis Group on Sept. 29

By Lisa Kerner

Charlotte, N.C., Aug. 26 - Hilb Rogal & Hobbs Co. said its board of directors unanimously recommended its shareholders vote in favor of the company's merger with Willis Group Holdings Ltd. at a special meeting on Sept. 29 at 10 a.m. ET in Richmond, Va.

The companies announced the $2.1 billion merger agreement in June.

Hilb Rogal shareholders may elect to receive Willis common stock or cash for their Hilb Rogal shares subject to proration, it was reported in a form 424B3 filed with the Securities and Exchange Commission.

It was previously reported that Willis will acquire all of the outstanding shares of common stock of Hilb Rogal for a total consideration of an estimated $46.00 per share subject to a collar.

Half of the value of the per-share merger consideration, or $23.00, is fixed whether a shareholder elects to receive cash or stock, a prior news release from the companies said.

The stock component will be calculated based on the average trading price of Willis common stock during the 10-day period ending two days prior to the closing date. If the average Willis stock price during the period is greater than or equal to $31.46 or less than or equal to $40.04, the stock component is fixed and is equal to $23.00, according to the companies.

Outside the collar, the exchange ratio is fixed and the value of the stock component may be worth more or less than $23.00, based on the value of Willis common stock, whether or not a shareholder elects to receive cash or stock, it was explained in the earlier release.

According to the SEC filing, the total merger consideration is subject to a mandatory cash component of approximately $845 million.

Willis, a London-based insurance broker, said previously that over time it plans to repurchase a majority of the shares issued in connection with the transaction under its previously approved $1 billion buyback plan.

Hilb Rogal is the eighth-largest insurance and risk management intermediary in the United States, with over 140 offices worldwide. The company is based in Glen Allen, Va.

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