Insurance broker Arthur J Gallagher & Co said on Friday it had agreed to buy the treaty reinsurance brokerage business of Willis Towers Watson for an initial consideration of $3.25 billion.
The deal comes weeks after Willis and rival Aon called off their $30bn merger that would have created the world's largest insurance broker following opposition from the US Department of Justice.
As part of approving the merger, European regulators had demanded the sale of Willis Re, the broker's reinsurance arm, to preserve competition, and Gallagher had agreed to buy it and other assets for about $3.6bn.
Reports earlier this month suggested Gallagher was close to clinching a deal for Willis Re, but Willis chief executive John Haley at the time said he was considering wider possibilities.
The latest deal, which includes a potential additional consideration of $750 million, is expected to close in the fourth quarter.
Treaty reinsurance involves reinsuring the whole of an insurer's book of business, rather than individual projects or risks.
Willis Re's treaty reinsurance business operates in 24 countries, places over $10bn of premium annually and represents more than 750 insurance and reinsurance company clients, according to the company.
Morgan Stanley is the financial adviser to Gallagher on the deal.