Beazley moves to force Hardy into takeover talks
Lloyds of London insurer Beazley today made a plea to shareholders in rival Hardy Underwriting to force its bid target into takeover talks.
Beazley has had two bids — one at 300p, the next at 330p — rejected by Hardy, which will not even meet to discuss the deal.
A statement today said: "Beazley believes that the board's resistance is not in the interests of Hardy's shareholders and urges them to encourage the board of Hardy to adopt a more constructive approach."
Beazley boss Andrew Horton says he will not go hostile.
"Due diligence is vital. It is too risky to do a hostile bid for an insurer."
Horton added that he had "the impression" Hardy investors would be supportive of a deal.
The companies are broadly similar — both can claim the distinction of never having made a loss. "We understand the business and think integration will be easy," said Horton.
The insurer today reported a 2% rise in premiums for the nine months to September of $1.35 billion (£840 million). Beazley has a combined ratio of 90% — that means it pays out 90p in claims for every £1 it takes in premiums.
By making an underwriting profit it is able to live with low investment returns of just 0.8%.
"We took a very defensive stance on the market. We have a conservative investment portfolio," said Horton.
The industry is braced for claims of up to $8 billion (£4.98 billion) from the Chile earthquake and up to $4 billion (£2.45 billion) for the one in New Zealand. Those two disasters will cost Beazley about $100 million (£62 million) at worst.
Beazley shares added 1p to 118p. Hardy shares added 14.5p to 313p.
