Chubb Urges Shareholders to Reject Mini-Tender Offer by TRC Capital

June 4, 2010

The Chubb Corp. is telling its shareholders to reject an unsolicited “mini-tender” offer by TRC Capital Corp. (TRC) to purchase up to two million shares, or approximately 0.6 percent, of the outstanding Chubb common stock at a price of $47.00 per share.

TRC’s offer price represents a 4.35 percent discount to the $49.14 closing price of Chubb’s common stock on May 26, 2010, the day before the offer commenced.

New Jersey-based Chubb said it opposes the offer because it is a mini-tender offer at a price below the current market price for Chubb’s shares and subject to numerous conditions.

Mini-offers are for less than 5 percent of a company’s securities and are viewed suspiciously by the Securities and Exchange Commission. They avoid many disclosure and procedural requirements of the SEC that apply to offers for more than five percent of a company’s outstanding shares.

The SEC has cautioned investors about mini-tender offers, noting that “some bidders make these offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price.”

The SEC offers tips regarding mini-tender offers online.

TRC has done this before. It has made similar offers for a small number of shares of PepsiCo and Kimberly-Clark Corp.

Shareholders who already have tendered their shares may withdraw their shares any time before June 25, the offer’s expiration date.

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