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Hartford Financial Services Group Inc. confirmed Thursday that it had received an unsolicited offer from rival Chubb Ltd.
“The Hartford’s Board of Directors is carefully considering the proposal with the assistance of its financial and legal advisors. The Board of Directors is committed to acting in the best interests of shareholders over the long term,” the insurer said in a statement.
The Chubb offer, which was reported earlier Thursday by Bloomberg, would reportedly value Hartford at about $22 billion.
In a statement later on Thursday, Chubb said its offer valued Hartford at $65 per share. Hartford's shares opened Thursday at $57.94 and closed at $68.15.
"We have not yet received a response to our proposal but are looking forward to constructive, private discussions in order to expeditiously consummate a fair transaction that benefits all of our respective stakeholders," the Chubb statement said.
Meyer Shields, Baltimore-based managing director at analyst Keefe, Bruyette & Woods Inc. said the deal seems “reasonable.”
“Chubb has long said that it wants a bigger share of the domestic small commercial insurance market, and that is one of (Hartford’s) best, probably it’s single best, operating unit,” he said. Other Hartford businesses also fit well with Chubb, such as middle market and specialty commercial, and possibly group benefits, he added
Chubb’s $78 billion market capitalization makes it more than three times the size of Hartford, whose stock jumped more than 18% on the reports. Chubb traded down more than 3%.
Chubb, which was founded in 1882, was itself transformed by an acquisition in 2016 when it was bought by Bermuda-based Ace Ltd., although the combined company retained the Chubb name.