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Chubb sold for $28.3B to Swiss insurer

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ACE Limited, a global property and casual insurer based in Switzerland, is buying Warren-based insurance company Chubb Corporation for approximately $28.3 billion in cash and stock, the companies announced Wednesday.

Both boards of directors have approved the definitive agreement, according to a news release, that will see Chubb shareholders receive $62.93 in cash and a 0.6019 of a share of ACE stock for each Chubb share they own. That would be a total of approximately $124.13 per share based on the closing price of ACE stock on Tuesday, the companies said.

After the close of the deal, ACE shareholders would own about 70 percent of the combined company, which will take on the Chubb name.

“We are thrilled to announce the acquisition of Chubb, a venerable company with a great brand,” Evan G. Greenberg, chairman and chief executive officer of ACE, said in a prepared statement. “This transaction advances our strategy in a meaningful way and represents an outstanding opportunity to create significant value over a reasonable period of time for both ACE and Chubb shareholders. We are combining two great underwriting companies that are highly complementary.”

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Greenberg will lead the combined company as chairman and CEO, while John D. Finnegan, chairman, CEO and president of Chubb, will become executive vice chairman for external affairs of North America.

“This is a compelling transaction for all Chubb and ACE shareholders,” Finnegan said in a statement. “The combination brings together two highly respected and successful companies with complementary capabilities, assets and geographic footprints. We are confident that it will deliver strong value to Chubb shareholders — including an immediate premium and participation in the future growth and profitability of a well-positioned combined company. 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.”

The combined company will be based in ACE’s home city of Zurich, but continue to utilize Chubb’s headquarters in Warren for its North American division, it said. It will also maintain a significant presence in Philadelphia, where ACE’s North American headquarters is located, it added.

The combined company would have a total shareholders’ equity of $46 billion and assets of nearly $150 billion, based on figures as of the close of 2014.

Guggenheim Securities LLC is serving as Chubb’s financial adviser, while Wachtell, Lipton, Rosen & Katz is serving as legal counsel. Morgan Stanley & Co. LLC is serving as ACE’s financial adviser, while Sullivan & Cromwell LLP is its legal counsel.

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