Aspen Insurance Rejects Exchange Offer From Endurance Specialty - Quick Facts

(RTTNews) - Aspen Insurance Holdings Limited (AHL) announced Tuesday that its board unanimously rejected the unsolicited exchange offer from Endurance Specialty Holdings Ltd. (ENH) to acquire all of the outstanding shares of Aspen for a combination of common stock and cash.

Aspen's Board determined the Offer is not in the best interests of Aspen or its shareholders and recommended that Aspen shareholders reject the Offer and not tender their shares to Endurance. The Board noted that the value offered by Endurance is unchanged from the unsolicited proposal Endurance made on June 2, 2014, which Aspen's Board thoroughly considered and rejected.

The company stated that proposal to increase the size of Aspen's board to 19 would create an unwieldy and untenable corporate governance structure and Endurance's scheme of arrangement would be an unprecedented usurping of an independent board's judgment in its attempt to acquire Aspen at a price that significantly undervalues Aspen.

Aspen also announced that it has filed a preliminary revocation solicitation statement with the SEC in connection with Endurance's plan to seek support from Aspen shareholders to: requisition the Aspen board to convene a special meeting of shareholders, at which meeting Aspen shareholders would vote on a proposal to increase the size of Aspen's board; and support Endurance petitioning the Supreme Court of Bermuda to request that the Court order a shareholder meeting, at which Aspen shareholders would vote on a proposal to approve a scheme of arrangement.

On 9th June, Aspen Insurance said Endurance Specialty Holdings had begun a hostile exchange offer for shares of Aspen for a combination of cash and stock. As per the terms of the offer, Aspen shareholders have the right to receive $49.50 in cash for each Aspen share, or 0.9197 Endurance shares for each Aspen share, or a combination 0.5518 Endurance shares and $19.80 in cash for each Aspen share.

The exchange offer will expire at 5:00 p.m., Eastern time, on Friday, August 29, 2014, unless extended.

On June 2, Endurance Specialty sweetened its bid for Aspen to $49.50 a share in in cash and Endurance shares from its initial offer of $47.50 per share. However, Aspen rejected the proposal, citing that it grossly undervalued the company, represented a strategic mismatch and would result in significant dis-synergies.

Moreover, the Aspen noted that the majority of the consideration included in the proposal consisted of Endurance stock, which is highly unappealing. The consideration mix was of 40 percent cash and 60 percent Endurance shares.