Chicago-based Specialty Underwriters’ Alliance, Inc. (SUAI) today announced that it has responded to a letter, dated July 1, 2008, from Hallmark Financial Services, Inc. (“Hallmark”) in which Hallmark stated that it was reaffirming its conditional proposal to acquire all the outstanding stock of SUAI for shares of common stock of Hallmark, valuing each share of SUAI stock at $6.50.
In a story covered by Insurance Journal on July 1, declined the original offer from Hallmark. And on June 26, the SUAI board of directors, in consultation with its financial and legal advisors, reviewed Hallmark’s proposal to acquire SUAI. After a thorough deliberation, the SUAI Board unanimously concluded that the Hallmark proposal should be rejected and that SUAI should remain independent and continue with the execution of its current business strategy, which the board believes represents a better long-term value for the company’s shareholders.
In a letter to Hallmark, dated July 2, SUAI informed Hallmark that, given that Hallmark’s letter of July 1, 2008 was just a restatement of the original Hallmark proposal, there was no reason for the board of SUAI to reconsider.
The following is a copy of SUAI’s letter to Hallmark dated July 2, 2008 to Mark E. Schwarz, executive chairman of Hallmark Financial Services, Inc., Fort Worth, Texas.
“I am writing in response to your letter of July 1, 2008 in which you state that you reaffirm the conditional proposal Hallmark Financial Services, Inc. (“Hallmark”) made, in a letter dated June 16, 2008 to the board of directors of Specialty Underwriters’ Alliance, Inc. to acquire all the outstanding stock of the company for shares of common stock of Hallmark, valuing each share of the Company’s stock at $6.50.
“The July 1st Letter does not constitute a new proposal, nor does it modify any of the material terms of the proposal that was set forth in the June 16th Letter and that was carefully considered by our Board and its advisers.
“The July 1st Letter also incorrectly characterizes the company as not having responded to your inquires since June 17, 2008. In fact, in an email to you on June 20, 2008, I invited you to send me any additional information that you felt our board should consider which you did not provide.
“As the company publicly announced on June 26, 2008, our board, in the exercise of its fiduciary duties, thoroughly considered the Hallmark proposal in light of the Company’s current business strategy and with input from our financial and legal advisors. After our Board’s review of the Hallmark proposal, it unanimously concluded that the Hallmark proposal should be rejected and that execution of the Company’s current business strategy represents a better long-term value for our shareholders.
“Given that the July 1st Letter is just a restatement of the original Hallmark proposal that our Board rejected, we see no reason for our board to reconsider that proposal.”
The letter was signed by Courtney Smith, chairman of the Board and CEO of Specialty Underwriters’ Alliance, Inc.
Source: Specialty Underwriters’ Alliance, Inc.
Topics Excess Surplus Underwriting
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