In a second major P&C insurance-industry M&A deal this week, ACE Limited and The Chubb Corporation announced today that the boards of directors of both companies have unanimously approved an agreement under which ACE will acquire Chubb.
As a result of the acquisition, the new company will move up into the “elite” group of global P&C insurers, with a combined total shareholders’ equity of nearly $46 billion and cash, investments and other assets of $150 billion. The transaction is expected to close during the first quarter of 2016.
The combined company, which will assume the Chubb name, is expected to remain a growth company with complementary products, distribution and customer segments.
“We are thrilled to announce the acquisition of Chubb, a venerable company with a great brand,” Evan G. Greenberg, chairman and CEO of ACE Limited, said in a statement. “We are combining two great underwriting companies that are highly complementary. We will make each other better and create a unique company in a class of its own that has greater growth and earning power than the sum of the two companies separately.”
John D. Finnegan, chairman, president and CEO of Chubb, said, “The combination brings together two highly respected and successful companies with complementary capabilities, assets and geographic footprints. We are pleased that the combined company will adopt the Chubb brand and view this as an affirmation that both companies share a commitment to the attributes of quality and service the brand represents.”
ACE’s U.S. commercial lines business provides a broad range of product and services for industrial, commercial, multinational and upper middle market companies, and relies heavily on brokers for distribution. Chubb is best known in the U.S. primarily as a middle-market commercial, specialty and surety insurer with a broad product portfolio and a major agency network. Chubb may be best known in the U.S. for its personal lines coverage to high-net-worth customers—a market that ACE also has been targeting.