As a result, Zurich said it had “terminated its discussions in connection with a possible offer for RSA“.
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Investor Cevian Capital, RSA’s top shareholder, was not immediately available for comment.
Zurich listed a series of issues in its own business that have hurt profitability, including losses associated with the explosions at Tianjin, China in mid-August estimated at an aggregate of $275m (£177m).
“Given the deterioration in profitability…”
Shares in British insurance group RSA have slumped 21% after rival Zurich abandoned its proposed £5.6bn bid for the business as it forecast a $200m (£130m) loss due to explosions at the Chinese port of Tianjin.
Zurich did not expand on its announcement on Monday that talks had been terminated.
Zurich first announced it was evaluating a potential offer for RSA on 28 July.
RSA added that it has continued to make good progress in the delivery of its action plans and results for July and August have been positive and ahead of its expectations.
“Additionally, we have announced the sale of our Latin America business, the principal outstanding piece of our strategic refocus programme”.
“The board and management of RSA look forward to the future with confidence in its prospects”, it said in a statement. Its priorities for that money remain unchanged, the company said.
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RSA shares fell 22% in early trading as some banks and investment houses advised clients to be less enthusiastic about the stock.
