NU Online News Service, July 13, 1:15 p.m. EDT

Two rating agencies affirmed the ratings on Aon Corp. after theChicago-based insurance broker announced plans to acquire Hewitt Associates Inc. for $4.9billion.

New York based rating agency Standard & Poor's RatingServices and Fitch Ratings in Chicago affirmed the ratings of Aonand said the outlook was stable.

"We believe the Hewitt acquisition will further bolster Aon'salready strong global posture in the consulting area," said NeilStein, creditor analyst for S&P in a statement. "In addition,we believe it will broaden and complement its overall business riskand earnings profile and create long-term operational synergies forthe enterprise."

S&P said while it views Aon's "strategic initiativesfavorably," there is still risk and uncertainty about theintegration, client and producer retention, challenges withcultural difference and client reaction to mixing Aon Hewitt teamsand restructuring plans.

"We believe that Aon must carefully balance what could be anoverwhelming pace of change to avoid unanticipated side effects,"S&P said.

Fitch said it "believes in the long term, Aon's acquisition ofHewitt will result in positive business and operation synergies,with reasonable integration risk."

Hewitt is a world leader in human resources consulting andoutsourcing, and the transaction "will significantly increase Aon'smarket share in this area," Fitch said.

The rating service went on to say that it believes the Aonmanagement team "has a very good track record related to theexecution of strategic plans and expense cutting," and for thatreason the broker can manage the integration risk.

In an analyst's note from Deutsche Bank, the firm said it seeslimited chance for competing bids for Hewitt. The most likelypotential bidders are IBM, ADP and Accenture. It also expects noanti-trust regulatory issues.

Aon said yesterday that it plans to acquire the Lincolnshire,Ill.-based human resource and outsourcing consulting firm in a50-50 cash and stock deal. The deal is expected to be completed bymid-November and the subsidiary will be named Aon Hewitt.

Yesterday, Moody's Investors Service affirmed Aon's debt rating,but changed the rating outlook from stable to negative. The ratingservice said the change was made over concerns with the move andthe execution risks of such a transaction.