US reinsurer Transatlantic Holdings Inc, has rejected a $3.24-billion takeover bid from National Indemnity Co, a unit of Warren Buffett's Berkshire Hathaway, saying that the offer does not constitute a superior proposal.
Transatlantic, once majority-owned by American International Group said the offer from National Indemnity ''is reasonably likely to lead to a superior proposal,'' The board ''determined to offer to engage in discussions and to exchange information with National Indemnity.''
National had offered to buy New York-based Transatlantic for $52 a share, but Transatlantic already had signed a deal in June to be acquired by Switzerland's Allied World Assurance Company Holdings in a $44.22 per share transaction, or $2.75 billion.
That offer has since dropped to $2.75 billion based on the falling stock prices (See: Insurer Allied World in $3.2-bn all-stock merger deal with Transatlantic)
In a twist over the fight over Transatlantic, its arch rival, Validus Holdings launched a $3.5 billion cash and stock hostile bid for Transatlantic in July, but the proposal currently is worth $46.36 per share, or $2.89 billion.
Transatlantic has rejected Validus offer terming it as too low and also filed a suit against Validus, alleging that Validus is in violation of securities laws in its proxy and tender offer materials to stockholders.