Chubb “Considering its Options” After Hiscox Rejection

February 6, 2001

Chubb Corp. announced that it is “considering its options regarding its 27 per cent holding of Hiscox shares,” following the Lloyd’s insurer’s decision to terminate discussions with Chubb to acquire its remaining shares.

Hiscox pulled out of the talks last week saying that Chubb’s offer of 210 pence ($3.087) a share, around $458 million, “significantly undervalued” the company.

Chubb’s announcement indicated that it felt its offer “was fair in the context of a realistic assessment of Hiscox’s prospects,” and that it was reexamining its position as a long-term investor, and might sell, or at least reduce, its stake.

Chubb paid 225 pence ($3.3075) a share for the stake it acquired in 1998, but analysts, in consideration of the improved prospects in the insurance market and Hiscox’s recent results, currently value the company at between 230 and 300 pence ($3.38 and $4.41). In addition most analysts felt that given the number of shares held by Hiscox management, Chubb was unlikely to attempt a hostile takeover, and might well return with a better offer.

Was this article valuable?

Here are more articles you may enjoy.