Aon has agreed to purchase Gallagher Re in a deal worth $45 million less than a month after Arthur J. Gallagher announced it was putting the company up for sale.

The transaction, announced Friday, will involve an initial cash payment of $30 million from Chicago-based Aon and additional payments over the next 12 months. Itasca, Ill.-based Gallagher said the payments should amount to an additional $15 million cash after closing.

The agreement involves Gallagher Re's U.S. and U.K. reinsurance brokerage businesses, with about 50 employees coming over from Gallagher to Aon, according to someone familiar with the arrangements.

In a statement, Michael D. O'Halleran, executive chairman of Aon Re Global, said the purchase would give Aon a larger presence in the U.S. accident, health and life markets and increase its capabilities in the U.K. specialty, casualty and financial institutions businesses. He said Gallagher Re has invested significantly in index-based capital markets solutions (a form of catastrophe securitization), which will add to Aon's capital markets team.

"We will be able to utilize our scale in accounts, analytics and services to drive innovation and significantly improve margins over a larger base, delivering immediate impact to our clients," he said.

In a separate statement, Gallagher said the U.S. portion of the deal was completed Friday and the U.K. purchase is still pending and is expected to be completed on or before April 30.

Gallagher said it estimates the sales proceeds to amount to $38 million and net pretax loss to amount to $22 million. There will also be approximately $15 million in lease termination costs in the 3rd and 4th quarter of this year.

Gallagher announced it was selling the reinsurance brokerage unit in January as part of a series of moves to cut costs, including the elimination of 400 positions through attrition.

During the company's fourth-quarter financial results analysts' conference call, J. Patrick Gallagher Jr. said the firm decided to sell the unit after careful consideration and the realization that the firm was unable to make the investment needed to make the unit competitive.

"It was a tough decision, but it will allow us to concentrate on our core business," said Mr. Gallagher at the time.

In an analyst's note, David Small with Bear Stearns said the acquisition was a good move for Aon. "While Gallagher struggled to make money in the reinsurance business, we suspect the acquired business will be immediately profitable on Aon's platform, as we suspect Gallagher Re's profitability problems were mainly attributable to lack of scale."

He added that this was the right move for Gallagher, despite a lower than expected price for the unit. The division was a drag on the firm's earnings and was not expected to reach the scale in size necessary to become profitable "in the foreseeable future."

Reinsurance brokering, he added, has become less about insurance placements and more concerned with selling analytical and modeling services.

"This new environment requires significant infrastructure investments to compete," he said, "which makes it harder for small niche players to compete with the major reinsurance brokers such as Aon Re, Guy Carpenter and Benfield."