The 6/29/09 online edition of the Wall Street Journal is reporting that Watson Wyatt and Towers Perrin, the 2nd and 5th largest compensation and benefits consulting firms, respectively, have agreed to merge in an all-stock deal valued at $3.5 billion.  The combined firm will have over $3 billion dollars in annual revenue and 14,000 employees, according to the report.

The Journal described the deal is a "recession-induced consolidation in the consulting industry," as the industry has been rocked by reductions in corporate spending for consulting and related services.

The new company, to be called Towers Watson & Company, will be listed under the Watson Wyatt's ticker symbol "WW."  Watson Wyatt is traded on the New York Stock Exchange, while Towers was a closely-held firm owned largely by its employees.