– Evan Greenberg extended an acquisition spree at his Ace Ltd. by agreeing to purchase Chubb Corp. for $28.3 billion in cash and stock.

Ace will own 70 percent of the company after the transaction closes, and Greenberg will lead the combined insurer, the companies said Wednesday in a statement. The purchase price is equivalent to about $124.13 per share for Chubb investors, or 30 percent higher than Tuesday's close.

The deal will help Zurich-based Ace compete with rivals including American International Group and Warren Buffett's Berkshire Hathaway. Chubb will bolster Ace's presence in the high-net-worth market covering mansions and yachts, and will add operations selling workers' compensation and commercial auto insurance.

"This changes almost everything" in the property-casualty insurance market, Meyer Shields, an analyst at Keefe Bruyette & Woods, said in an e-mail. "Ace is a very experienced and successful acquirer."

Greenberg, 60, the son of former AIG CEO Maurice "Hank" Greenberg, has been expanding Ace through acquisitions around the world, gaining scale and diversifying risk, rather than focusing on share buybacks as Chubb had preferred. Ace has bought businesses in Brazil, Thailand and Mexico in recent years. In December, the company agreed to purchase Allianz SE's Fireman's Fund unit serving wealthy clients.

"This transaction advances our strategy in a meaningful way and represents an outstanding opportunity to create significant value over a reasonable period of time," Greenberg said in the statement.

Chubb investors will receive $62.93 in cash and 0.6019 share of Ace stock for each share they own, the companies said.

Chubb would have needed a new CEO as John Finnegan, 66, was slated to step down at the end of next year after leading the company since late 2002. The combined company will take the Chubb name, which traces its roots to 1882 when Thomas Caldecot Chubb and his son Percy founded a marine insurer in New York, according to the company's website.

Finnegan will assist with the transition and be executive vice chairman for external affairs of North America. Ace's board will be expanded to 18 members, with four from Chubb.

"Combined, with a larger, stronger balance sheet, we will be even better positioned to compete and win in a market environment in which size, global reach, and differentiating capabilities are increasingly key to long-term success," Finnegan said in a conference call.

Greenberg, who was named to lead Ace in 2004, had predicted a wave of mergers and acquisitions among insurers amid increased competition.

"That hunger builds," he said in October. "I expect you'll see more M&A activity as time goes on. I expect you'll see more of a feeding frenzy for what comes to market."

The transaction is expected to be completed in the first quarter of next year and will immediately add to earnings per share and book value, Ace said. The buyer forecast annual savings of about $650 million before taxes by the third year after closing, according to the statement.

Ace plans to fund the deal through a combination of cash on hand and the issuance of $5.3 billion in senior notes with a range of maturities. Chief Financial Officer Phil Bancroft said the company will probably limit share buybacks.

The combined company will be based in Zurich and maintain substantial operations in New Jersey and also in Philadelphia, a center of Ace's U.S. operations, the company said.