Zurich Makes Bold £77 Billion Bid for Beazley

The insurance giant Zurich has unveiled a significant £7.7 billion bid for Beazley, a London-listed insurer. If successful, this acquisition could create a leading entity in specialty insurance, with combined gross written premiums soaring to approximately $15 billion.

Mario Greco, chief executive of Zurich Insurance Group, has made it clear that the approach is not intended to be aggressive, following a history of behind-the-scenes discussions with Beazley since at least the previous summer. He has received criticism for bypassing Beazley’s board, opting instead to contact shareholders directly with a cash offer.

The current offer of £12.80 per Beazley share marks a notable increase from an earlier proposal of £12.30, which had been rejected. Beazley responded by stating that the revised offer significantly undervalued the company and indicated that it had not yet fully considered the new proposal.

Following the announcement, Beazley shares surged by 42.7 percent, ending the trading day at £11.70. The current bid represents a 56 percent premium over Beazley’s undisturbed share price and exceeds the all-time high recorded last June by 32 percent.

This development represents the second bid for a FTSE 100 company this year, following preliminary discussions between the miners Rio Tinto and Glencore. Beazley, established in 1986, has evolved into one of the world’s largest specialist insurers, covering diverse areas such as cybersecurity, fine art, and pleasure yachts.

Zurich operates as Switzerland’s largest insurer, deploying resources across both general and life assurance segments. The company employs approximately 55,000 individuals globally, with around 4,500 located in the UK. This proposed move could reshape the competitive landscape of the insurance sector.

Greco has downplayed fears regarding potential job losses as a result of the merger, emphasizing that the focus is on enhancing skills and knowledge, rather than pursuing efficiency savings. Analysts suggest that while the current offer is attractive, Beazley’s unique value could warrant a heightened proposal.

Under City takeover regulations, Zurich must submit a formal offer for Beazley by February 16, or it will be required to withdraw its bid. Beazley has committed to providing updates regarding the situation in due course.