By David Trainer

Endurance Specialty Holdings (ENH) made a $3.2 billion takeover bid for Aspen Insurance Holdings (AHL) on Monday. The bid was unsolicited. And, reportedly, it was made public after months of fruitless negotiations led ENH to attempt to bypass AHL’s management and reach out to shareholders directly.

We think ENH’s offer undervalues the stock. AHL’s Chairman Glen Jones sent a similar message:

“Endurance’s ill-conceived proposal undervalues our company, represents a strategic mismatch, carries significant execution risk, and would result in substantial dis-synergies. Furthermore, most of the consideration to Aspen shareholders would be in a stock that would reflect these problems.”

AHL’s board has rejected the offer, a decision that shareholders should support.

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