Zurich Makes £7.7 Billion Bid for Specialty Insurer Beazley

Core Viewpoint - Zurich Insurance Group AG has made a £7.67 billion ($10.3 billion) bid to acquire Beazley Plc, offering 1,280 pence per share, which represents a 56% premium over Beazley's closing price prior to the announcement [1][2]. Group 1: Acquisition Details - The bid is Zurich's fifth proposal to Beazley over the past year and marks the company's largest offer since CEO Mario Greco took over in 2016 [2]. - The acquisition aims to create a "global leader" in specialty insurance with approximately $15 billion in gross written premiums [1]. - Zurich plans to fund the acquisition through existing cash, new debt facilities, and an equity placing [6]. Group 2: Market Reaction - Following the announcement, Beazley's shares surged by as much as 46%, reaching their highest level since the company's debut in 2002, while Zurich's shares fell by up to 1.9% [4]. Group 3: Strategic Fit and Valuation - CEO Mario Greco emphasized that Beazley is a complementary business to Zurich, indicating a strong strategic fit [3]. - A top 20 Beazley shareholder expressed that Zurich's offer still undervalues the company, suggesting that Beazley's peak-cycle earnings would warrant a higher bid [3]. Group 4: Financial Performance - Beazley reported net insurance written premiums of $5.2 billion in 2024 and $2.6 billion in the first half of 2025 [6]. - The company's premium income is diversified, with risks under property and specialty categories each accounting for about a third, and cyber and digital insurance representing around a fifth [7]. Group 5: Future Considerations - Zurich has until February 16 to announce a firm offer for Beazley, in accordance with UK takeover regulations [9]. - The proposed acquisition is expected to be accretive to Zurich's financial targets for 2027 [9].