Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why Aspen Insurance Holdings Limited Shares Rocketed Higher

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Aspen Insurance Holdings (NYSE: AHL  ) , a global insurance and reinsurance company specializing in commercial and environment liability, as well as casualty insurance, jumped by as much as 19% after receiving an unsolicited takeover offer from Endurance Specialty Holdings (NYSE: ENH  ) .

So what: Under the terms of the offer, Endurance was willing to acquire Aspen for $47.50 per share in a mixed 60% stock and 40% cash deal valuing the company at $3.2 billion (a 21% premium to its close on Friday). Endurance believed acquiring Aspen would be immediately accretive to EPS and contribute to $100 million in annual cost savings. However, Aspen's board of directors rejected Endurance's proposal with Glyn Jones, chairman of the board, noting that the deal was "not in the best interests or Aspen or its shareholders. Endurance's ill-conceived proposal undervalues our company, represents a strategic mismatch, carries significant execution risk, and would result in substantial dis-synergies."

Now what: Tell us how you really feel, Glyn! It's pretty evident that there isn't a price that Endurance can put on Aspen Insurance that's going to sway the board toward accepting a buyout. But that may not stop another suitor from stepping up to the plate or for Endurance to attempt a hostile takeover of Aspen and take its offer directly to shareholders. This is a situation that investors would be wise to keep their eyes on. However, it's rarely prudent to chase a stock higher solely on the premise of buyout rumors. With that being said, I'm going to watch the festivities play out from the sidelines.

Shares of Aspen Insurance Holdings may be soaring today, but they'll likely be hard-pressed to keep pace with this top stock in 2014
There's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2914567, ~/Articles/ArticleHandler.aspx, 9/2/2015 1:23:23 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Sean Williams

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and in investment planning topics. You'll usually find him writing about Obamacare, marijuana, developing drugs, diagnostics, and medical devices, Social Security, taxes, or any number of other macroeconomic issues.

Today's Market

updated Moments ago Sponsored by:
DOW 16,239.01 180.66 1.13%
S&P 500 1,934.36 20.51 1.07%
NASD 4,691.73 55.62 1.20%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/2/2015 1:07 PM
AHL $45.23 Up +0.32 +0.71%
Aspen Insurance Ho… CAPS Rating: *****
ENH $62.34 Up +0.04 +0.06%
Endurance Specialt… CAPS Rating: *****