Aon Founder Pat Ryan Resigning

By Steve Tuckey

NU Online News Service, Sept. 30, 2:49 p.m.EDT?Aon chief executive and founder Patrick Ryan saidtoday he is resigning his post effective upon the appointment of asuccessor.[@@]

In the surprise announcement, the 67-year-old executive said hewould remain as chairman of the board of the Chicago-area-basedinsurance broker.

Since 1990, Mr. Ryan has led the company to the No. 2 positionin the insurance brokerage field just behind New York City-basedMarsh McLennan Companies.

Andrew McKenna, head of the board's governance committee, willhead the recruitment effort for the CEO post.

At the same time, Michael D. O'Halleran, 54, president and chiefoperating officer, has removed himself from consideration for thetop post. He will give up his current posts to serve as senior vicepresident of the company.

Morgan Stanley analyst Vinay Saqi said Mr. O'Halleran's moveindicates the company will look for an outsider for the topjob.

"The moves are not likely to come as a huge surprise toinvestors, although they could cause some volatility in the stock,"Mr. Saqi said in a note to investors.

He also asserted that the company's credibility has suffered oflate due to the fact that its operating performance has lagged itspeers by a wide margin.

"After announcing that the company would look to achieve 20percent pretax margins in that business in 2005, managementrecently noted that the goal would be difficult to reach, givenslowing revenue growth," Mr. Saqi wrote. "We guess that trendslikely remained difficult in the third quarter."

Mr. Ryan became chief executive of the firm in 1982 aftermerging his Ryan Group into the entity that eventually became Aon.He became chairman in 1990.