Insurance giant Chubb has announced an offer to acquire The Hartford insurance group for $23 billion. The price represents a 26% premium to The Hartford’s 20-day volume weighted average share price. The purchase would be completed with a mixture of cash and stock, with the majority paid in cash.
It is important to note that The Hartford has yet to respond to Chubb’s offer, and discussions are likely to take place in private in the coming weeks. However, if the deal is completed, it would be the largest in the U.S. insurance space since Chubb was acquired by ACE (and retained the former’s brand).
It comes at a relatively difficult time for insurers, as low risk investment opportunities have been few and far between with bonds still sitting near historically low yields.