Towers Watson to pay $215M for exchange builder

Towers Watson will spend $215 million to buy Liazon Corp., a 6-year-old company that operates private health insurance exchanges for employer-sponsored benefit plans.

Towers Watson (NYSE:TW) says it is acquiring the Buffalo, N.Y.-based company to expand its presence in the private exchange sector.

Liazon was founded in 2007 and operates the Bright Choices Exchange. It has about 120 full-time employees.

The venture capital arm of Bain Capital — a private equity firm that Mitt Romney started — helped find $12.6 million in financing for Liazon in April 2011. In April 2012, Liazon announced that it had raised another $18.2 million in funding.

Liazon has been active in helping employers set up "defined contribution health plans" — programs to give employees cash and let them pick their own coverage from a website that offers a menu of plan options.

Ashok Subramanian, the chief executive officer, and Alan Cohen, a co-founder and chief strategy officer, told LifeHealthPro in September 2012 that their company was providing exchange programs for 2,000 employers with a total of about 50,000 enrollees in two dozen states.

The company now says it serves about 2,400 employers.

The company has been distributing its services through benefits brokers.

The Associated Press contributed information to this report.

CORRECTION: An earlier version of this story described Liazon's client list incorrectly.

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