After consultation with its financial and legal advisors, The Hartford has announced that its Board of Directors has unanimously rejected re/insurer Chubb’s approximately $23.24 billion acquisition offer.
Following reports in the media that Chubb had approached carrier The Hartford over a potential acquisition, Chubb later confirmed it had made an offer to combine with the rival insurer, valuing it at $65 per share.
At the time, Chubb said that it believes its proposal to combine with The Hartford is “strategically and financially compelling for both sets of shareholders and other constituencies.”
However, 12 days after Chubb’s unsolicited proposal, The Hartford has announced its rejection of the bid and explains that, “entering into discussions regarding a strategic transaction would not be in the best interests of the company and its shareholders.”
Additionally, the Board has reaffirmed its commitment and resolve in the continued execution of the company’s strategic business plan.
As we wrote at the time, Chubb’s $65 per share offer actually valued the firm at around $2.5 billion higher than The Hartford’s $20.7 billion value at opening on March 18th, the day before Chubb confirmed its proposal.
However, speculation around a potential deal pushed The Hartford’s shares up by 19% during the day, taking its valuation to a high of $24.6 billion during trading, to close the day at $24.36 billion.
In recent days, analysts have ben debating the offer and the sentiment appears to be that perhaps the offer from Chubb was too low, while the door for others to table competing bids is open.
Interestingly, we’ve been polling our readership at Reinsurance News on this deal and the data shows that while 25% of respondents felt the deal might get completed at the offer amount made, 50% said that Chubb will need to raise its offer if it’s to be successful in its efforts to acquire The Hartford.