By Lisa Kerner
Charlotte, N.C., May 14 - IPC Holdings, Ltd. continued to recommend that its shareholders vote in favor of the company's amalgamation with Max Capital Group Ltd. on June 12.
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.
IPC urged shareholders not to tender their shares in Validus Holdings, Ltd.'s exchange offer that began on Tuesday. As previously reported, the offer gives IPC shareholders 1.2037 Validus common shares for each IPC common share held and ends at 5 p.m. ET on June 26.
On Thursday, Validus filed an application with the Supreme Court of Bermuda to convene a meeting of IPC shareholders in connection with its proposed scheme of arrangement.
"The IPC board continues to believe strongly that IPC's proposed amalgamation with Max best achieves our goal of delivering superior shareholder value by diversifying beyond our monoline property catastrophe business," IPC chairman Kenneth L. Hammond said in a company news release.
Max and IPC said they have received all of the regulatory conditions required to complete their amalgamation agreement, including approvals from the insurance commissioners of the states of Indiana and Delaware and early termination of the Hart-Scott-Rodino waiting period granted by the Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice.
"IPC anticipates closing the transaction with Max on or shortly after our annual general meeting of shareholders on June 12 with all regulatory approvals obtained," Hammond said.
According to Hammond, the Validus exchange offer provides the same exact economic terms as the previous Validus proposal as well as the same significant execution risk and closing uncertainty.
Validus denied
On Tuesday, the Supreme Court of Bermuda Commercial Court decided not to grant Validus' application for an expedited trial on its litigation against IPC and Max.
Validus said its lawsuit challenges the $50 million termination fee and "no-talk" provision in the IPC/Max agreement.
The court ordered Validus to pay IPC's and Max's costs associated with the application.
"Despite Validus' efforts, the litigation, which we believe is without merit, will not be an impediment to closing our combination with Max," an IPC news release said.
Validus said the Supreme Court's ruling was "only related to the timetable for the proceedings and was not a judgment on the merits of Validus' claims."
The ruling will not affect Validus' attempt to complete its acquisition of IPC, including the exchange offer and the scheme of arrangement, Validus said.
Max's shareholders will also vote on the transaction on June 12. The company believes Validus' litigation is meant to be a distraction to its shareholders.
Three-part acquisition plan
Validus previously announced a three-part plan to acquire IPC that includes:
• Soliciting IPC shareholders to vote against the proposed Max amalgamation;
• Beginning an exchange offer for all IPC common shares; and
• Pursuing a scheme of arrangement under Bermuda law.
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
|
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