Haverford Ends Effort to Acquire Omega Stake

Haverford (Bermuda) Ltd. said it has ended all discussions on a possible partial cash offer for Omega Insurance Holdings Ltd., citing Omega's negative response to its latest offer.

In mid-December, Haverford renewed its effort to acquire 25% of Lloyd's insurer Omega "substantially on the same terms" as the approach it abandoned after expressing dissatisfaction with Omega's performance (Best's News Service, Dec. 15, 2011). Omega's premiums fell 16.2% in the first nine months, reflecting in part, the group's previously announced exits from marine energy and retrocessional classes of business.

In early December, Haverford had said its offer had been valued at up to 50 million pounds (US$78.4 million). That had been based on a share price of 83 pence. The new offer was 74 pence(US$1.14) in cash per share for 60.2 million shares of Omega. The element of a "Dutch auction" using a strike price mechanism has been removed from the offer.

The original partial cash offer Haverford announced on Sept. 12 had lapsed on its terms, according Haverford.

"In light of Omega's rejection of Haverford's proposal, Haverford notified Omega, on 21 December 2011 pursuant to the terms of the agreement between them dated 27 April 2011, that all negotiations and discussions relating to a possible transaction in Omega shares have been terminated," said Haverford in a brief statement.

Omega-managed Lloyd's Syndicate 958 and Lloyd's both have a current Best's Financial Strength Rating of A (Excellent). Omega Specialty Insurance Co. Ltd. has a Best's Financial Strength Rating of A- (Excellent).

(By David Pilla, international editor, BestWeek: [email protected])