By Lisa Kerner
Charlotte, N.C., June 8 - Validus Holdings, Ltd. upped the cash portion of its offer for IPC Holdings, Ltd. by $0.75 to $3.75 per share.
IPC shareholders will also receive 1.1234 Validus voting common shares per IPC share under the offer.
The total consideration of the new offer is valued at $30.67 per IPC share based on Validus' closing price on Friday, according to a Validus news release.
"This significant cash increase maintains the clear superiority of Validus' offer," Validus chairman and chief executive officer Ed Noonan said in a company news release.
As previously reported, IPC rejected Validus' offer to acquire IPC for $3.00 in cash and 1.1234 Validus voting common shares for each IPC common share.
However, Validus extended its exchange offer for IPC to 5 p.m. ET on June 26.
Max Capital Group Ltd. and IPC agreed to combine in a stock-for-stock transaction valued at approximately $912 million. As previously reported, Max shareholders will receive 0.6429 IPC shares for each Max share.
"Unlike the proposed amalgamation with Max, the Validus offer provides a substantial premium to IPC shareholders, a significantly larger cash component, and the opportunity to benefit from being part of a much stronger, far more profitable, and well diversified company," Noonan said.
IPC shareholders were urged by Validus to vote against the proposed Max amalgamation at IPC's meeting on June 12. Max shareholders will also vote on the deal at a separate meeting on June 12.
Max reacts to offer
Max chairman and CEO W. Marston (Marty) Becker called Validus' change of $0.75 "inconsequential" and said Validus is delivering an "overvalued and risky currency."
Validus' new offer, according to Becker, "fails to reach the level of financial and strategic benefits afforded to IPC and Max shareholders by the IPC-Max merger."
"By contrast, the IPC-Max merger provides real fundamental current and long-term strategic value, true diversification that produces more stable returns, and a tangible transaction that is ready to close," Becker said in a statement.
Becker encouraged Max shareholders to vote for all the proposals relating to the IPC/Max transaction on the white proxy card.
IPC, Max amend deal
Last week, IPC and Max amended their agreement to include the payment of two special cash dividends totaling $2.50 per share to IPC shareholders if the IPC/Max deal closes.
The first dividend of $1.50 per share will be payable to IPC shareholders of record as of June 15.
Shareholders of the combined company will receive $1.00 per share in cash once the transaction is complete.
Max said that for its shareholders, the $1.00-per-share dividend is equal to $0.64 for each share of Max prior to exchange from the closing of the transaction.
Based in Hamilton, Bermuda, Validus provides insurance coverage and reinsurance coverage in the property, marine and specialty lines markets.
IPC, located in Pembroke, Bermuda, provides property catastrophe reinsurance as well as aviation, property-per-risk excess and other short-tail reinsurance.
Specialty insurance and reinsurance provider Max is based in Hamilton, Bermuda.
Mentioned in this article
| IPC Holdings, Ltd.: | Nasdaq: IPCR
|
| Max Capital Group Ltd.: | Nasdaq: MXGL
|
| Validus Holdings, Ltd.: | NYSE: VR
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
