Transatlantic Holdings Inc., the reinsurer that agreed to merge with Allied World Assurance Company Holdings AG, said it will ask Validus Holdings Ltd. to improve its counteroffer, Bloomberg News reports. Allied World has operations in Farmington.
“The Validus proposal is reasonably likely to lead to a superior proposal,” Transatlantic’s board said yesterday in a statement, announcing its intention to enter into discussions with Bermuda-based Validus.
Validus said last week it would pay about $3.5 billion in stock and cash for New York-based Transatlantic.
The reinsurer agreed in June to merge with Allied in a stock deal valued at about $3.2 billion. That was opposed by some of Transatlantic’s largest shareholders, including Davis Selected Advisers LP, which held a 24 percent stake as of July 5.
Validus today urged Transatlantic holders to vote against the Allied deal. Validus remains “fully committed” to its proposal, the company said in a statement.
The Validus offer “does not constitute a ‘superior proposal’ under the merger agreement that Transatlantic entered into with Allied World,” the Transatlantic board said.
Allied agrees “that the unsolicited proposal set forth by Validus does not constitute a superior proposal,” Scott Carmilani, chairman and chief executive officer of the Zug, Switzerland-based firm, said in a statement.
