Australia's AUB Group sinks as EQT, CVC drop $3.44 billion pursuit

Adds background in paragraph 4, analyst comments in 5-6

By Kumar Tanishk and Nikita Maria Jino

Dec 1 (Reuters) - Australia's AUB Group AUB.AX said on Monday its suitors EQT EQTAB.ST and CVC Asia Pacific had abandoned their pursuit that valued the insurance broker at A$5.25 billion ($3.44 billion), sending its shares more than 17% lower.

Shares of the Sydney-based firm plunged 17.5% by 0011 GMT to A$30.66 in what could be their weakest day on record and were the top losers on the benchmark ASX200 index .AXJO, which was trading flat.

The consortium of Swedish private equity firm EQT EQTAB.ST and CVC Asia Pacific opted to halt further talks, AUB said in a statement, adding that the A$45 per-share offer aptly mirrored its market value.

The offer price represented a 25.1% premium to AUB's last close when announced in late October. The stock has never reached the offer price.

"Australian insurance companies remain attractive, despite a large player walking away from AUB," said Jessica Amir, a market strategist at online trading platform Moomoo, noting that premiums have been rising and margins are expanding as interest rates stay elevated.

"Regardless of the failed takeover, the fundamentals remain intact - a clear 'nothing to see here' moment for long-term shareholders... It also opens the door for rival bidders and gives retail investors a chance to buy the dip."

Meanwhile, AUB reaffirmed its fiscal 2026 forecast, projecting underlying net profit after tax in the range of A$215  million to A$227  million, up from A$200.2  million in 2025.

The group operates at 579 locations across Australia and serves nearly 1.2  million clients.

($1 = 1.5272 Australian dollars)

(Reporting by Kumar Tanishk and Nikita Maria Jino in Bengaluru; Editing by Subhranshu Sahu)

((tanishk.Kumar@thomsonreuters.com; X: @thatstanishk))