GO
Loading...

Enter multiple symbols separated by commas

Converium Urges Scor Shareholders to Block Bid

Converium Holdings has issued an appeal to Scor shareholders urging them to vote against the French insurer's capital increase at its AGM on Apr 26, thereby blocking the takeover bid for Converium.

In a full-page advertisement in French business daily Les Echos, Converium's board of directors said Scor shareholders "do not have all the information necessary to weigh up the advantages and disadvantages of the proposed merger," and should therefore oppose the capital increase that would enable Scor to move ahead with its plans to acquire the 67.1% it does not already own in its Swiss rival.

The board said the bid presents major execution and integration risks which will be "detrimental to the growth prospects of the new structure and to the value of Scor shares." Converium went even further in the statement, saying a hostile takeover will lead to a loss of customers and key staff at both companies, and undermine Converium's joint ventures with Global Aerospace Underwriting Managers, and Medical Defence Union, leading to a loss of business.

It also questioned the logic behind the merger saying "the projected cost savings are extremely optimistic given the execution risks involved," adding that Converium risks losing one of its major advantages "the beneficial fiscal environment (it) enjoys in Switzerland." Earlier this week, Converium urged its own shareholders to reject Scor's takeover offer, saying the French group's hostile bid fundamentally undervalues the company and could result in a loss of business of up to $800 million.

In the offer, published in Swiss newspapers earlier this month, Scor is offering half of one of its shares plus 4 Swiss Francs in cash per Converium share, unchanged from its preliminary offer.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Piper Hoppe, 10, from Minnetonka, Minnesota, holds a sign at the doorway of River Bluff Dental in Bloomington, Minnesota, on July 29, 2015, during a protest against Cecil's killing.

    The U.S. Fish and Wildlife Service has been trying to find the man who shot a lion in Zimbabwe, but he is not responding.

  • Donald Trump

    From one real estate mogul about another: Don't underestimate Republican presidential candidate Donald Trump.

  • Rifle sight

    Hackers were able to exploit a sniper rifle's vulnerabilities and change the gun's target, according to Wired.

U.S. Video