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Zurich Insurance has approached Beazley with a £7.7bn takeover proposal after the Lloyd’s of London insurer rejected a lower bid earlier this month.

The Swiss insurer said on Monday that it was offering £12.80 per share, up from the previous undisclosed approach of £12.30. The increased all-cash offer represents a 56 per cent premium to the FTSE 100 group’s share price at the end of last week.

Zurich’s decision to make its interest public sent Beazley’s shares soaring more than 42 per cent to £11.70 in London, giving the company a market capitalisation of £7.1bn.

Zurich chief executive Mario Greco told the FT that the latest bid was the group’s fifth offer for Beazley since its first takeover approach about a year ago.

“It was time to go public and eventually have [Beazley’s] shareholders say what they think,” he said.

Jefferies analyst Philip Kett said in a note that the proposal offered “fair value” and made strategic sense, but the two times price-to-book multiple was “perhaps not as high as it could be” given that takeover multiples had recently ranged up to 2.5 times.

Beazley said that its board had not yet had an opportunity to consider the latest offer.

Under UK takeover rules, Zurich has until February 16 to make a firm offer or walk away from a deal for at least six months.

Shares in Beazley’s London-listed peers Hiscox and Lancashire rose about 9 per cent and 4 per cent, respectively, on Monday.

Greco said that Zurich wanted to acquire Beazley to expand its own speciality insurance business, which spans construction, energy and infrastructure cover, as well as its cyber and AI insurance portfolio.

Beazley has built its brand around cyber insurance but last year said it would trim its exposure to the market as prices for the product fell and claims rose, a move that knocked investor confidence.

Cyber insurance prices have fallen in recent months, part of a broader downturn in speciality insurance and reinsurance prices after capital has flooded into the market chasing elevated returns.

But Greco said the bid for Beazley “wasn’t opportunistic at all”, adding that over the past year, “when I saw dips in their share price, I didn’t move, I didn’t contact them”.

Zurich had reinsured the building of more than 200 data centres and saw more room to expand its speciality insurance unit, he said, as AI has fuelled more investment in infrastructure as well as the emergence of new risks.

A Beazley takeover would boost Zurich’s speciality insurance business, which pulled in about $9bn of insurance premiums in 2024, to about $15bn in gross written premium — a measure of annual revenue.

“We’re a bigger player in cyber than they are,” Greco said, adding that bringing in Beazley’s talent would produce “very strong market consolidation”.

UK mergers and acquisitions reached a post-pandemic high last year, driven by foreign buyers seeking to capitalise on low valuations by snapping up domestic groups.

Zurich’s takeover attempt is the latest move by a suitor to pursue a London-listed target by taking its bid public without waiting for a recommendation from the target’s board.

Investment group FitzWalter Capital is pursuing a roughly £500mn acquisition of the UK’s Auction Technology Group, tabling its latest proposal on Friday. ATG said on Monday that its board concluded that the offer “fundamentally undervalued” the company.

A Beazley takeover would also give Zurich greater access to the Lloyd’s of London insurance marketplace, which Greco said held particular appeal as a vehicle to access private capital.

Zurich is being advised by investment bankers at Goldman Sachs, Lazard and UBS, according to people familiar with the matter.