The Hartford's board of directors has unanimously rejected rival Chubb's $23.24 billion buyout proposal.
After consultation with the insurance company's financial and legal advisors, The Hartford said in a statement that its board of directors determined that entering into discussions regarding a strategic transaction would "not be in the best interests of the company and its shareholders."
"The board reaffirmed its commitment and resolve in the continued execution of The Hartford’s strategic business plan," the company added.
On Thursday, The Hartford confirmed Chubb's "unsolicited, non-binding proposal" for the 200-year-old insurance company, adding in a statement that its board of direcotrs would carefully consider the proposal and that it would "act in the best interests of shareholders over the long term."
Chubb's proposal would have valued Hartford at $65 per share. Hartford has a market cap of around $23 billion, smaller than Chubb's $75 billion. The announcement sent shares of the Connecticut-based company soaring on Thursday, while shares of Chubb dropped.
|HIG||THE HARTFORD FINANCIAL SERVICES GROUP INC.||72.78||+2.25||+3.18%|
The deal would have been one of Chubb’s largest since its chief exeuctive officer Evan Greenberg merged the company with Ace Limited in 2016.
The rejection comes as Chubb has been faced with a series of lawsuits after clients who bought insurance policies with the company claim it failed to provide adequate coverage during the coronavirus pandemic.
Among them is Jujamcyn, the owner of multiple Broadway theatres, who filed a lawsuit against the insurer in August. According to the Wall Street Journal, the most recent lawsuit against Chubb, as well as a small group of other insurers, was filed by Caesars Entertainment on Friday.
Shares of The Hartford fell 1.5% in premarket trading on Tuesday following the announcement.