Employee benefits group Watson Wyatt has merged with another company in the same business, Towers Perrin Forster & Crosby.

The two US-based companies, both of which have a presence in Ireland, agreed a merger of equals in a $3.5 billion deal that will create a new, publicly-listed business called Towers Watson.

Watson Wyatt chief executive John Haley will act as chief executive of the new group with Tower chief executive Mark Mactas becoming president of the merged entity.

The companies ultimately expect to see annual savings of $80 million as a result of the deal.