Aon plc, a global insurance broker, has agreed to buy NFP, a New York-based mid-market property and casualty broker, wealth manager, and retirement plan advisor, from its financial investors for $13.4 billion in cash and stock.

The acquisition will be funded with $7 billion in cash and $6.4 billion in Aon stock, including funds affiliated with private equity companies HPS Investment Partners and Madison Dearborn Partners, NFP’s primary capital backer.

The acquisition expands London-based Aon’s presence in the rapidly growing middle-market segment.

NFP’s chairman and CEO, Doug Hammond, will continue to lead NFP as a separate but integrated platform within Aon. Hammond will report to Aon President Eric Andersen.

“We have continually evolved our leading capabilities to better serve our clients’ growing needs amidst increasing volatility across the marketplace,” said Greg Case, CEO of Aon. “The acquisition will advance our relevance to clients, create opportunities for our colleagues and further strengthen our shared cultural values.”

According to Aon, the acquisition is expected to generate more than $2.8 billion in pretax gains, after deducting approximately $400 million in one-time transaction and integration costs.

The transaction is expected to be dilutive to adjusted EPS in 2025, breakeven in 2026, and accretive in 2027 and beyond, with positive impacts to free cash flow beginning in 2026.

Founded in 1999, NFP was acquired by Madison Dearborn Partners in 2013 for $1.3 billion. The firm has been busy with acquisitions, including Divergent Wealth Advisors LLC in September and Wealthspire Advisors in June.

The deal, which is expected to close in the middle of 2024, will bring NFP’s more than 7,700 employees and over $2.2 billion in revenue to the Aon.