Towers Watson, a global professional services company, announced on Friday that it has acquired Liazon Corporation, a leader in developing and delivering private benefit exchanges for active employees. The acquisition, which follows the purchase of Extend Health in June 2012, solidifies Towers Watson's strength in the private exchange market through its OneExchange solution. Going forward, Towers Watson will continue to enhance Liazon's award-winning private exchange solution and serve the needs of Liazon's leading broker, consultant and carrier partners, some of which offer the Liazon product under their own brands.The purchase price is $215 million, with the acquisition anticipated to be dilutive to adjusted EPS by approximately $0.10 to $0.15 in fiscal year 2014. There is no impact to the forecasted EBITDA margins. More information will be provided during a call for investors on Monday, November 25, 2013 at 10:00am ET. The live broadcast will be available online at the investors section of www.towerswatson.com.
Liazon's online benefit marketplaces are currently distributed through over 400 insurance brokers, including nine of the top 10 national firms, under either the Bright Choices® brand or as a third-party proprietary exchange. Towers Watson plans to continue these relationships based upon their current terms and use the Liazon name in the market with its broker partners. Towers Watson will also continue to offer its OneExchange solution, which primarily serves larger employers. The OneExchange and Liazon solutions together will help organizations of all sizes deliver self- and fully insured benefits to both employees as well as pre- and post-65 retirees in new and cost-effective ways.
"Liazon has built a growing business by offering customized private exchange approaches through an extensive network of partners. We are delighted to team with them and serve a part of the market that Towers Watson had not previously reached," said John Haley, CEO of Towers Watson. "As more employers evaluate private exchanges, bringing Liazon into the Towers Watson family will help us - and Liazon's distribution partners - offer employers scalable, cost-effective and high-performing benefit plans to their employees."
Liazon was founded in 2007 in Buffalo, NY, to transform the delivery of employee benefits. Its system is built on a flexible, cloud-based technological platform that offers a suite of comprehensive decision-support and education tools. Liazon employs 120 full-time employees and has been recognized as among the fastest-growing and most innovative companies in America.
Liazon co-founder and CEO, Ashok Subramanian, will join the leadership team of Towers Watson's Exchange Solutions segment. Bryce Williams will continue to lead the overall segment.
"This is a transformational time for benefits in the United States. The combination of Towers Watson's benefit expertise and OneExchange solution with Liazon's flexible platform and extensive broker network will create the preeminent private benefit exchange solution for employers of all sizes," said Subramanian. "By joining Towers Watson, we'll be better positioned to achieve our top priority - to provide our clients and partners with an even greater array of best-in-class tools, resources and service across all market segments."
Cadwalader, Wickersham & Taft LLP acted as legal advisor to Towers Watson. Lowenstein Sandler LLP acted as legal advisor to Liazon Corporation.
A replay of the call for investors will be available through December 25, 2013 at 617-801-6888, confirmation number 96349738.
About Towers Watson
Towers Watson (NYSE, NASDAQ: TW) is a leading global professional services company that helps organizations improve performance through effective people, risk and financial management. The company offers solutions in the areas of benefits, talent management, rewards, and risk and capital management. Towers Watson has 14,000 associates around the world and is located on the web at towerswatson.com.
About Liazon
Founded in 2007, Liazon Corporation operates the industry-leading private benefit exchange for businesses. Its flagship product, the Bright Choices® Exchange, is an online benefit store that is changing the way employers and employees buy benefits. Bright Choices helps employers manage their health care costs by setting predictable budgets through a defined contribution funding strategy while guiding employees to purchase better coverage of health, dental, vision, life, disability and other benefits. Advanced cloud computing infrastructure and robust security protection ensures continual access and safeguards confidentiality of data transmission. Liazon works with top national and regional insurance providers and supports more than 2,400 businesses nationwide through a distribution network of leading broker partners. Liazon has offices in Buffalo, NY, and New York City, and is located on the web at liazon.com