Hartford said the board, after consulting with its outside advisers, “determined that entering into discussions regarding a strategic transaction would not be in the best interests of the company and its shareholders.”
Chubb representatives couldn’t be immediately reached for comment.
Chubb said last week that the March 11 proposal would value Hartford at $65 a share, adding that the combination “would be strategically and financially compelling for both sets of shareholders and other constituencies.”
At $65, the offer was 12% above Hartford’s opening price of $57.94 on Thursday, when Chubb’s approach was disclosed. Analysts at Piper Sandler said the $65 proposal price represented a premium of about 26% on its 20-day volume weighted average share price of $51.70 as of March 10. The shares jumped nearly 19% last Thursday.
Shares stood at about $66.77 shortly after the opening bell Tuesday.
Analysts said an acquisition would help the global Chubb—one of the world’s biggest insurers—expand sales of policies to small and midsize business clients. Analysts said its next move is unclear, as it has the financial strength to sweeten its offer, if it chooses, but such a move could be dilutive to its earnings.
Some analysts said other potential acquirers could emerge, though a limited number of publicly traded rivals are big enough to mount a bid.
As of Monday, Chubb had a market capitalization of about $70 billion, and Hartford’s was approximately $24 billion.
The 211-year-old Hartford said its board reaffirmed “its commitment and resolve in the continued execution of The Hartford’s strategic business plan.”
Hartford’s chief executive officer, Christopher Swift, has made some acquisitions over the past few years as the firm narrowed its focus. Those deals included buying a specialty business insurer, Navigators Group, and a unit from Aetna Inc. that provides life insurance, disability-income insurance and other products for companies’ employee-benefit programs.
The company was one of the hardest-hit U.S. insurers during the 2008-09 global meltdown. The firm took federal aid, which it has since fully repaid. In the years since, Hartford divested various units to focus mostly on property-casualty insurance for businesses and individuals, offerings for employers’ benefit programs and a mutual-funds business.
Hartford said Goldman Sachs & Co. LLC and Deutsche Bank AG are acting as its financial advisers. Cleary Gottlieb Steen & Hamilton LLP is acting as legal counsel.