Aon Corp.'s plan, announced last week, to purchase London-based reinsurance broker Benfield Group Ltd. for $1.75 billion (?935 million) has drawn mixed evaluations from the three major rating agencies.

Fitch Ratings, Moody's Investor's Service and Standard & Poor's said they believe the company's move would solidify Chicago-based insurance broker Aon's position as the top reinsurance broker. However, they differed over their evaluation of the impact the purchase will have on the company's liquidity and integration risks.

Aon said last week it would purchase Benfield for $6.55 (?3.50) a share, 29 percent above Benfield's Thursday closing stock price. As part of the deal, Aon will assume $170 million of the company's debt, which one rating service termed modest. The all-cash deal is expected to be completed by the end of this year.

Fitch affirmed Aon's issuer default rating of "triple-B-plus," its related senior debt and "F2" commercial paper rating. It said the outlook is stable.

Fitch said its rating reflected Aon's strong balance sheet and that its financial leverage "will remain within a reasonable range for the rating category in the near term."

Moody's affirmed Aon's senior unsecured debt rating of "Baa2," but changed the rating outlook to stable from positive, reflecting concerns about integration risk and an expected decline in the firm's cash position.

"The proposed transaction strengthens Aon's global market presence," Moody's Bruce Ballentine, lead analyst for Aon, said in a statement. "We believe the company has sufficient resources to fund the acquisition and related restructuring costs while maintaining a sound credit profile."

S&P placed Aon's "triple-B-plus" counterparty credit rating on credit watch with negative implications, citing concerns with company cash flows and liquidity as well as integration risks.

In a statement, Neil Stein, an S&P credit analyst, said if the rating service is satisfied with Aon's liquidity it would affirm the rating, but if the review is not satisfactory it would either "affirm the rating and assign a negative outlook or lower the rating, but by no more than one notch."

Chief executives at both Aon and Benfield stressed that the compelling reason for the merger is that their businesses complement one another. The two businesses would be integrated and operate under the name Aon Benfield Re. The deal, they said, is expected to save $122 million in annual costs by 2011 with the elimination of shared administrative and support services.

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Aon's Acquisition Of Benfield Gets Mixed Reviews

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