Aspen’s board of directors has, after “careful evaluation”, unanimously rejected the unsolicited proposal from Endurance to acquire Aspen for $47.40 per share.
Aspen cites unprofitable business segments and a “disdain for Lloyd’s” as reasons for their rejection.
Commenting on the proposal, Glyn Jones, chairman of the board of directors, says: "After careful review and deliberation, the board of directors unanimously determined that Endurance's proposal is not in the best interests of Aspen or its shareholders.
“Endurance's ill-conceived proposal undervalues our company, represents a strategic mismatch, carries significant execution risk, and would result in substantial dis-synergies. Furthermore, most of the consideration to Aspen shareholders would be in a stock that would reflect these problems.
"Aspen has a proven track record of performance and a clear strategy to increase shareholder value. Endurance has a mixed operating track record, new leadership, an unproven strategy, and no experience with large acquisitions. Moreover, this transaction would be highly disruptive to Aspen's corporate culture, which has proven to be a significant competitive advantage in the marketplace."
In making its determination, Aspen says it is “executing a clear strategy to deliver superior value for shareholders, while Endurance's proposal undervalues the company and carries significant risks”.
Aspen argues that the combined teams would have no clear strategy, while singling out Endurance’s insurance and crop business as being “unprofitable” and challenged respectively.
Aspen added that Endurance has shown “public disdain” for Lloyd’s, which has proved a strong engine of growth for Aspen.
The company adds that Endurance has a “mixed operating track record, no experience with large acquisitions, new leadership and an unproven strategy.”
It also says that disruption resulting from the transaction would likely result in material losses to business.