Zurich goes public with £7.7bn bid for UK insurer Beazley

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Zurich Insurance has approached Beazley with a takeover proposal valuing the FTSE 100 group at about £7.7bn, after the Lloyd’s of London insurer rejected a lower bid earlier this month.

The Swiss insurer said on Monday that it was offering £12.80 per share, up from the previous undisclosed approach of £12.30.

Zurich’s decision to make its interest public sent Beazley’s shares soaring about 41 per cent to £11.50 in afternoon trading in London, giving the company a market capitalisation of almost £7bn.

Zurich’s chief executive Mario Greco told the FT that the latest bid was the group’s fifth offer for Beazley since its first takeover approach about a year ago.

“It was time to go public and eventually have [Beazley’s] shareholders say what they think,” Greco said.

Zurich is being advised by investment bankers at Goldman Sachs, Lazard and UBS, according to people familiar with the matter.

Greco said that Zurich wanted to acquire Beazley as a way of growing its own speciality insurance business, which spans construction, energy and infrastructure cover, as well as its cyber and AI insurance portfolio.

Beazley has built its brand around cyber insurance but last year said it would trim its exposure to the market as prices for the product fell and claims rose, a move that knocked investor confidence.

UK mergers and acquisitions reached a post-pandemic high last year, driven by foreign buyers seeking to capitalise on low valuations by snapping up domestic groups.

Zurich’s takeover attempt is the latest move by a suitor to pursue a London-listed target by taking its bid public without waiting for a recommendation from the target’s board.

Investment group FitzWalter Capital is currently pursuing a roughly £500mn acquisition of the UK’s Auction Technology Group, tabling its latest proposal on Friday. ATG said on Monday that its board concluded the offer “fundamentally undervalued” the company.

A takeover of Beazley would also give Zurich greater access to the Lloyd’s of London insurance marketplace, which Greco said held particular appeal as a vehicle to access private capital.

Beazley did not respond to requests for comment.