A.M. Best Places Credit Ratings of Validus Holdings, Ltd. and Its Subsidiaries Under Review with Developing Implications
January 22 2018 - 3:35PM
Business Wire
A.M. Best has placed under review with developing
implications the Financial Strength Rating (FSR) of A (Excellent)
and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of “a” of
Validus Reinsurance, Ltd. (Validus Re) (Hamilton, Bermuda)
and the following subsidiaries of Validus Holdings, Ltd.
(Validus) (Hamilton, Bermuda) [NYSE:VR]: Western World Insurance
Company, Stratford Insurance Company and Tudor
Insurance Company (all headquartered in Parsippany, NJ), and
Validus Reinsurance (Switzerland) Ltd. (Zurich,
Switzerland).
A.M. Best also has placed under review with developing
implications the Long-Term ICR of “bbb” and the Long-Term Issue
Credit Ratings (Long-Term IR) of Validus, the ultimate parent
company. (See below for a detailed listing of the Long-Term
IRs.)
The Credit Rating (rating) action follows the announcement of an
agreement to purchase Validus by American International Group,
Inc. on Jan. 22, 2018, for $68.00 per share in cash for an
aggregate transaction value of $5.56 billion. The transaction
represents a 46% premium to Validus’ closing share price on Jan.
19, 2018, and a 39% premium to Validus’ three-month volume weighted
average price as of Jan. 19, 2018. This deal is expected to close
in mid-2018, with 100% cash consideration paid to Validus common
shareholders. The ratings will remain under review until the deal
closes and A.M. Best completes its evaluation of organizational
changes and strategic position within the new structure. A likely
outcome may be that Validus’ and its subsidiaries’ FSR and
Long-Term ICRs will be affirmed with the outlook reverting to
stable from the current positive outlook. The under-review status
may be updated in the interim period if new facts and circumstances
present themselves.
The following Long-Term IR has been placed under review with
developing implications:
Validus Holdings, Ltd.—
-- “bbb” on $250 million 8.875% senior
unsecured notes, due January 2040
The following indicative Long-Term IRs for securities available
under the shelf registration have been placed under review with
developing implications:
Validus Holdings, Ltd.—
-- “bbb” on senior unsecured debt-- “bbb-” on
subordinated debt-- “bb+” on preferred stock
This press release relates to Credit Ratings that have been
published on A.M. Best’s website. For all rating information
relating to the release and pertinent disclosures, including
details of the office responsible for issuing each of the
individual ratings referenced in this release, please see A.M.
Best’s Recent Rating Activity web page. For
additional information regarding the use and limitations of Credit
Rating opinions, please view Understanding Best’s Credit
Ratings. For information on the proper media use of Best’s
Credit Ratings and A.M. Best press releases, please view
Guide for Media - Proper Use of Best’s Credit Ratings and A.M.
Best Rating Action Press Releases.
A.M. Best is the world’s oldest and most authoritative
insurance rating and information source. For more information,
visit www.ambest.com.
Copyright © 2018 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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version on businesswire.com: http://www.businesswire.com/news/home/20180122006476/en/
A.M. BestSusan Molineux, +1 908-439-2200, ext.
5829Associate
Directorsusan.molineux@ambest.comorSteven Chirico, +1
908-439-2200, ext.
5087Directorsteven.chirico@ambest.comorChristopher
Sharkey, +1 908-439-2200, ext. 5159Manager, Public
Relationschristopher.sharkey@ambest.comorJim Peavy, +1
908-439-2200, ext. 5644Director, Public
Relationsjames.peavy@ambest.com
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