U.S. property and casualty insurer Alleghany Corp said on Monday it would purchase reinsurer Transatlantic Holdings Inc for $3.4 billion in cash and stock -- though a sharp drop in Alleghany shares meant a separate, hostile bid for Transatlantic was at least temporarily more valuable.The Transatlantic saga has dragged on for months, since it first struck a deal with peer Allied World Assurance Co Holdings Ltd in June. That merger fell apart in September amid opposition from Transatlantic's largest shareholder and in the face of two unsolicited offers that were worth more money.The new deal with Alleghany is worth far more than the Allied World bid. But the spoiler in the Allied deal, which may spoil the Alleghany offer as well, is reinsurer Validus Holdings Ltd .Because Alleghany fell sharply and Validus rose in midday trading Monday, Validus's hostile cash-and-stock offer was worth about $2 a share more than the Alleghany bid. One analyst said Validus could even pursue a higher spread than that.
Transatlantic Holdings, Inc. (TRH) is a holding company. Shares of TRH traded higher by 1.32% or $0.72/share to $55.15. In the past year, the shares have traded as low as $43.85 and as high as $54.08. On average, 1087640 shares of TRH exchange hands on a given day and today's volume is recorded at 3729862.
Validus Holdings, Ltd. provides reinsurance and insurance coverage in the property, marine and specialty lines markets, and insurance coverage. Shares of VR traded higher by 2.09% or $0.6/share to $29.25. In the past year, the shares have traded as low as $23.24 and as high as $34.95. On average, 1201970 shares of VR exchange hands on a given day and today's volume is recorded at 1793073.
Alleghany Corporation is engaged, through Alleghany Insurance Holdings LLC (AIHL) and its subsidiaries RSUI Group, Inc. Shares of Y fell by 7.57% or $-23.78/share to $290.48. In the past year, the shares have traded as low as $278.74 and as high as $342.71. On average, 16470 shares of Y exchange hands on a given day and today's volume is recorded at 207267.
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