Transatlantic Rejects Offer, Sues Validus
[Updated] Transatlantic Holdings Inc. sued Bermuda based reinsurer Validus Holdings Ltd. in federal court in Delaware, contending the company is trying to mislead Transatlantic stockholders into tendering their shares in violation of securities law.
The New York Times reports that “Transatlantic Holdings rejected a $3.2 billion hostile bid by Validus Holdings and took up a number of antitakeover defenses, including suing Validus and instituting a poison-pill plan.”
Transatlantic said that it remained committed to its own planned merger with another insurer, Allied World Assurance, which it asserted would create more long-term value for shareholders.”
Update: Ed Noonan, Chairman and Chief Executive Officer of Validus, said today, “We are disappointed but not surprised by today’s response from the Transatlantic Board, particularly given their prior demand that we agree to a restrictive standstill before entering into discussions regarding our Superior Proposal. We believe their insistence on a standstill agreement is nothing more than a poorly disguised attempt to prevent us from bringing our Superior Proposal to Transatlantic stockholders.”
“Today, the Transatlantic Board has taken further steps to entrench themselves by establishing a poison pill, initiating meritless legal action, and changing corporate by-laws in an apparent effort to more easily manipulate stockholder meetings. These actions appear to be intentionally designed to trample on the rights of Transatlantic’s stockholders.”
“Validus believes that these actions by the Transatlantic directors – willfully burying their heads in the sand and blaming it on their ill-advised acquisition agreement with Allied World – are inconsistent with their fiduciary duties to Transatlantic’s owners.”
“Transatlantic is spreading misinformation about Validus’ Superior Offer in an effort to hide the simple fact that Validus’ offer provides greater market value than the inferior Allied World takeover offer.”
Validus deserves to be sued due to the fact that they tried to cut Allied Worlds throat
So if that logic could be followed, then every corporation that competes for any kind of contract or aquisition deserves to be sued. Take a football team for example… if they offer to purchase a player for 20m, and another team comes and offers 25m out of nowhere, then do they deserve to be sued? its not really appropriate to take a critical view like this, especially if (and I’m not saying you HAVEN’T) you every detail of both offers are not both read, studied and understood completely.