Chubb confirms offer to buy The Hartford
The proposed deal, which would largely be settled in cash, represents a 26% premium on The Hartford’s average share price, Chubb stated.
The Hartford confirmed it has received an unsolicited, non-binding acquisition proposal from Chubb Ltd. The target firm reports its board of directors is considering the deal.
The proposal values The Hartford at $65 per share, which represents a 26% premium based on its unaffected 20-day volume-weighted average share price of $51.70 (as of March 10), according to Chubb, which said the deal would be a mixture with the majority in cash and the remainder in stock.
Shares of The Hartford have more than doubled during the past year, Bloomberg reported, giving the insurer a market capitalization of around $23 billion as of March 18.
“Chubb’s potential acquisition of the Hartford would boost Chubb’s market presence in U.S. small commercial and personal lines while adding integration risk and potentially higher financial leverage,” Bruce Ballentine, Moody’s investor services senior vice president — senior credit officer, said in a statement. “Hartford would benefit from becoming part of a large global P&C insurer, although such a merger could disrupt relationships with its customers, agents and employees.”
If the deal closes, it could be one of the largest the industry sees all year. Chubb confirmed it has not received a response and noted if the transaction goes through, there can be “no assurances as to its terms, structure or timing.”
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