Shares of Validus Holdings Ltd (VR.N) fell as much as 10 percent after the reinsurer outbid rival Allied World Assurance (AWH.N) for Transatlantic Holdings Inc (TRH.N), with investors questioning both the price and the additional risk Validus is adding to its books. Analysts had been deeply split on whether anyone would seek to outbid Allied World. Some said yes, given what they felt was a discounted price; others said no, citing what they perceived as a unique cultural fit between Transatlantic and Allied. Shares of Validus, which termed its $3.5 billion deal for Transatlantic "superior," slipped to an eight-month low of $27.87 on the New York Stock Exchange. Analysts said Validus, which has a relatively pristine balance sheet with virtually no exposure to what insurers call "long-tail lines," will now be taking additional risk from Transatlantic.
Validus Holdings, Ltd. provides reinsurance and insurance coverage in the property, marine and specialty lines markets, and insurance coverage. Shares of VR fell by 8.2% or $-2.525/share to $28.28. In the past year, the shares have traded as low as $24.41 and as high as $34.95. On average, 887129 shares of VR exchange hands on a given day and today's volume is recorded at 7026178.
Allied World Assurance Company Holdings, AG, formerly Allied World Assurance Company Holdings, Ltd. Shares of AWH traded higher by 1.08% or $0.61/share to $57.33. In the past year, the shares have traded as low as $42.84 and as high as $65.70. On average, 301597 shares of AWH exchange hands on a given day and today's volume is recorded at 1444929.
Transatlantic Holdings, Inc. (TRH) is a holding company. Shares of TRH traded higher by 5.88% or $2.88/share to $51.90. In the past year, the shares have traded as low as $43.85 and as high as $54.08. On average, 668098 shares of TRH exchange hands on a given day and today's volume is recorded at 4606532.
