Bermuda-based Max Capital Group Ltd. has announced that it and IPC Holdings, Ltd. have agreed to pay two cash dividends that deliver $2.50 per share to IPC shareholders following the closing of the IPC-Max merger. The first payment is for $1.50 per share in cash payable to IPC shareholders of record as of June 15, 2009, followed by an additional $1.00 per share in cash payable to shareholders after the transaction closes.
Max shareholders will also receive a cash dividend of $1.00 per share in cash for each share of IPC following the closing of the transaction, which is equal to $0.64 for each share of Max prior to exchange from the closing of the transaction.
Max Cap’s Chairman and CEO, W. Marston (Marty) Becker described the proposal as creating “value potential,” and said it has “strong investment community support.” He also restated Max’s position that the merger “of Max’s long-tail portfolio with IPC’s short-tail portfolio is very capital efficient and attractive from a rating agency standpoint, and will still free up a significant amount of excess capital for both business growth and capital enhancement, complementing the dividend payments to provide incremental value to our shareholders.”
IPC’s Chairman, Kenneth L. Hammond, agreed that the dividend proposals make “an excellent transaction even more rewarding to both IPC shareholders and to all of the shareholders of the combined company.” He added that the “hostile offer by Validus, on the other hand, is inferior from a valuation standpoint, is fraught with uncertainty, and only serves the interests of Validus.”
Source: Max Capital – www.maxcapgroup.com