US-based property-casualty insurer Chubb has made a preliminary proposal to buy rival The Hartford Financial Services Group in a cash and stock deal worth $23.2bn.

According to Chubb, the deal would be ‘strategically and financially compelling for both sets of shareholders and other constituencies’.

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The company offered to pay $65 per share for the proposed acquisition. It said that the consideration represents a mix of stock with the majority in cash.

The Hartford has confirmed the news and said that its board of directors, with support from its financial and legal advisers, is carefully considering the unsolicited, non-binding proposal from Chubb.

“We have not yet received a response to our proposal but are looking forward to constructive, private discussions in order to expeditiously consummate a fair transaction that benefits all of our respective stakeholders,” Chubb said in a statement.

The insurer also said that the possibility of a transaction materialising is not certain, adding that “even if a transaction is agreed upon, there can be no assurances as to its terms, structure or timing”.

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The deal, if materialised, would be the first mega-deal in the insurance space that is grappling with losses brought about by the Covid-19 pandemic.

In addition to property and casualty insurance, The Hartford offers group benefits and mutual funds. Founded in 1810, the Connecticut-headquartered company currently has a workforce of around 18,500.

Previously in 2019, Chubb acquired a certain stake in African Trade Insurance Agency in a deal valued at approximately $10m.

The same year, the insurer reached an agreement to purchase an additional 15.3% stake in China-based Huatai Insurance Group.