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Validus says its offer for IPC superior to Max Capital deal
By Lisa Kerner
Charlotte, N.C., March 31 - Validus Holdings, Ltd. offered to acquire IPC Holdings, Ltd. in a share-for-share exchange that values IPC shares at $29.98 based on Monday's closing prices.
Each IPC common share will be exchanged for 1.2037 Validus common shares, according to a March 31 letter from Validus to IPC's board of directors.
"This proposal represents a compelling strategic combination that we believe would generate superior value for both Validus and IPC shareholders," Validus chairman and chief executive officer Ed Noonan said in a news release.
"The shareholders of both companies would benefit from being part of a larger, more diversified, global business, which would be a market-leading carrier in Bermuda's short-tail reinsurance and insurance market."
Validus said it prefers to negotiate with IPC but is prevented from doing so under IPC's agreement and plan of amalgamation with Max Capital Group Ltd.
As previously reported, Max and IPC agreed to combine in a stock-for-stock transaction valued at approximately $912 million. Max shareholders will receive 0.6429 IPC shares for each Max share.
According to Validus, its proposal is superior to the Max transaction.
IPC said its board will review the proposal consistent with its obligations under the agreement with Max and will comment when it makes a determination regarding the offer.
Validus asked IPC's board to respond to its binding offer by April 15.
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.
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