Validus Files Lawsuit against IPC Holdings and Max Capital

April 29, 2009

Bermuda-based Validus Holdings, Ltd. has fired another salvo in its attempt to derail the planned amalgamation of IPC Re with the Max Capital Group (See IJ web site – and

Validus announced that it has filed legal proceedings in the Supreme Court of Bermuda against IPC Holdings, IPC Limited and Max Capital Group Ltd. “that challenge the $50 million termination fee and ‘no-talk’ provision contained in the Agreement and Plan of Amalgamation between IPC and Max, dated as of March 1, 2009, as amended on March 5, 2009 (the ‘Max Amalgamation Agreement’).”

Validus said it is “seeking among other things an injunction to restrain payment of the termination fee and to restrain operation of the “no-talk” provision on the bases that (1) because of its excessive size, the termination fee amounts to an unlawful penalty under Bermuda law and is accordingly unenforceable, and (2) entry into the Max Amalgamation Agreement, in circumstances where the agreement contained the termination fee and “no-talk” provision, constituted a breach of the directors’ fiduciary duties.”

Validus added that, as it has previously disclosed, “if the termination fee is eliminated or reduced, Validus will not object to IPC’s paying the amount by which the termination fee is reduced as a dividend to IPC shareholders, so that IPC shareholders – and not Max or Validus shareholders – will share in the value obtained.”

Source: Validus Holdings –

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