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Validus committed to merger with IPC despite deal with Max Capital
By Lisa Kerner
Charlotte, N.C., April 8 - Validus Holdings, Ltd. said it continues to believe that its proposal to acquire IPC Holdings, Ltd. is superior to Max Capital Group Ltd.'s offer for the company.
"We are extremely disappointed that IPC's board of directors has rejected our proposal in favor of an obviously inferior alternative," Validus chairman and chief executive officer Ed Noonan said in a news release.
"While we would have preferred to work cooperatively with IPC, we remain fully committed to our proposal and expect to use all available means to complete our transaction."
According to a Wednesday letter to IPC from Validus, it has retained a proxy solicitor and will be touch with IPC's shareholders to solicit votes against the deal with Max.
Validus said it is also taking legal action to reduce the $50 million Max termination fee, which it called "an unenforceable penalty under Bermuda law."
On Tuesday, IPC announced that its board unanimously reaffirmed its recommendation that IPC shareholders vote to approve the definitive amalgamation agreement between IPC and Max.
IPC and Max 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.
Validus offered to acquire IPC in a share-for-share exchange that values IPC shares at $29.98.
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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