Willis Towers Watson PLC will conduct a strategic review of its reinsurance brokerage business and its CEO still expects to retire by year-end, the executive said in the broker's second-quarter earnings call with analysts Tuesday.

The Willis board has authorized financial advisors to initiate the review process for Willis Re, CEO John Haley said.

“We believe this is an appropriate time to explore strategic alternatives for this business,” he said.

Mr. Haley’s comments come after a plan to sell much of Willis Re to rival Arthur J. Gallagher & Co. fell through when Aon PLC’s much bigger deal to purchase all of Willis collapsed in the face of regulatory opposition. Recent market speculation has suggested that Gallagher may still buy Willis Re, but likely at a higher price than was previously agreed.

Mr. Haley added that the termination of the Aon deal “is the right decision for Willis Towers Watson.”  Aon last week paid Willis the $1 billion breakup fee that was required under the acquisition agreement.

Mr. Haley, who was expected to retire on completion of the sale to Aon, plans to stay on through the end of 2021. He said the company’s “intention” is not to extend his contract but to identify a successor within that timeframe.

Mr. Haley said that while Willis was “disappointed” to have lost staff recently during the merger process, the broker would move “aggressively … to replace some of the talent we’ve lost.” He added that while overall attrition rates were in line with those of 2019, the merger process had made it more difficult to hire new staff.

Client retention rates had remained at the same level as prior years, Mr. Haley said.

Willis reported second-quarter revenue of $2.59 billion, up 5% over the prior-year period. On an organic basis, which excludes the effect of foreign exchange and other variables, revenue grew 4% for the quarter.

Net income for the second quarter was $736 million, more than double the profit for the 2020 quarter.

Among Willis’ operating segments, benefits delivery and administration saw the biggest revenue growth, up 24% to $287 million; corporate risk and broking grew 10% to $810 million; human capital and benefits grew 3% to $875 million; and investment, risk and reinsurance slipped 2% to $605 million.