The British company’s shares increased 40% on Monday after Zurich Insurance Group made an upgraded bid of 7.67 billion pounds ($10.3 billion) for specialty insurer Beazley.
The idea was made public by Europe’s second-largest insurer by market value, following Beazley’s rejection of a number of previous strategies, the specifics of which had not yet been made public.
Beazley, a London-listed company, said it has not yet taken Zurich’s most recent offer into consideration after rejecting a January 4 bid that it claimed severely undervalued the firm on Friday.
In addition to expanding in Britain at a time when its exposure to the U.S. and the weak dollar has affected its performance and shares, acquiring Beazley would give Zurich a greater footing in specialty insurance, spanning areas including cyber, marine, aviation, space, and fine art.
In November, Zurich informed investors that it intended to expand its specialist insurance business. This month, the company established a global division headquartered in London.
Beazley is worth around 7.67 billion pounds based on Zurich’s most recent bid of ¥1,280 pence per share, which is 56% more than Beazley’s most recent closing price of 820 pence.
Zurich declared that it will use cash, fresh debt, and an equity placement to finance the purchase.
On Monday, CEO Mario Greco told the Financial Times that Zurich had attempted to purchase Beazley five times during the previous year. According to Beazley and Zurich, the most recent offer was for 1,230 pence per share.
RIVAL SHARES Additionally, London insurers gain
Beazley’s shares reached a record high, making them the largest percentage gainer among all London-listed stocks.
As investors wagered on additional sector consolidation, rivals also increased, with Hiscox up 7.4% and Lancashire up 4.5% at 1600 GMT.
With comparatively lower UK valuations still attracting buyers, a successful transaction would be the most recent foreign offer for a London-listed business.
Shares of Zurich fell 0.9%.
The 56% premium “feels generous,” according to Jefferies analysts, but they also noted that Beazley’s unique cyber business and industry-leading return on equity might support a larger valuation.
Zurich has until February 16 to declare a firm intention to make a bid or withdraw in accordance with UK acquisition regulations.
Zurich is receiving advice from Goldman Sachs, Lazard, and UBS. According to Beazley, JPMorgan and Barclays were offering advice.
ZURICH WANTS TO GROW IN THE UK AND SPECIALITY INSURANCE
By leveraging Beazley’s competence in specialty insurance and its presence at the Lloyd’s of London marketplace, Zurich said that acquiring Beazley would unite two complementary businesses.
According to the Swiss corporation, a merger would align with the strategic targets presented at Zurich’s Investor Day on November 18.
Only $5 billion of the approximately $47 billion in gross premiums written by Zurich’s international property and casualty division in 2024 came from the UK. Due to pressure from the weak dollar and its exposure to the United States, Zurich’s shares have only increased by 8% since the beginning of 2025.
As of Friday’s close, Beazley’s shares had likewise underperformed, with minimal movement over the preceding 12 months compared to a 20% increase in the FTSE 100.
