Endurance has sent a new letter to Aspen shareholders calling for them to back its proposal to acquire Aspen, arguing that Aspen has consistently underperformed and that the acquisition makes strong strategic sense.
In the letter, Endurance outlined the outperformance of Endurance across a number of key metrics including combined ratio, diluted book value per share and share price performance, adding that nearly half a year has passed since its initial, hostile approach was rejected.
Endurance also criticised Aspen for increasing its catastrophe reinsurance exposure during such a soft period in the cycle, something Endurance described as “a striking surge in risk premium for Aspen’s shareholders in exchange for the dubious benefit of short term growth.”
Endurance attacked Aspen’s relationship with third party providers in developing its US insurance business, arguing that such an approach served to prop up growth, but without considering the long-term interest of Aspen shareholders.
The letter also said Aspen had eroded loss reserves in recent years, which Endurance said exposed shareholders to unnecessary reserve risk.
Endurance, Aspen, M&A