Slide 1: Validus Agreed Amalgamation with IPC
Investor Presentation Validus Agreed Amalgamation with IPC August 2009
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Cautionary Note Regarding Forward-Looking Statements: This presentation may include forward-looking statements, both with respect to us and our industry, that reflect our current views with respect to future events and financial performance. State
Slide 3: Non-GAAP Financial Measures and Proposed Acquisition
Non-GAAP Financial Measures and Proposed Acquisition In presenting Validus' results, management has included and discussed certain financial measures that are not calculated under standards or rules that comprise U.S. GAAP. Such measures are referred to as non-GAAP. Non-GAAP measures may be defined
Slide 4: An Attractive Transaction for Validus Shareholders
An Attractive Transaction for Validus Shareholders Creates a leading Bermuda carrier in the short-tail reinsurance and insurance market with a global underwriting platform Superior long-term growth and return prospects Quality diversification in profitable lines Capacity to add a significant amount
Slide 5: Overview of the Agreed Transaction: Structure and Consideration
Structure Amalgamation under Bermuda Law Consensual transaction supported by Boards of IPC and Validus Consideration $7.50 cash and 0.9727 Validus voting common shares per IPC common share Fixed exchange ratio, not subject to adjustment Valuation and Premium Overview of the Agreed Transaction Note:
Slide 6: Overview of the Agreed Transaction: Transaction Value
Transaction Value1 Total value of $1.81 billion Cash consideration of approximately $424 million Issuance of $1.39 billion in Validus voting common shares Pro Forma Ownership (Fully-Diluted Basis) 62% by Validus Shareholders 38% by IPC Shareholders Key Approvals and Conditions IPC and Validus shareh
Slide 7: A Validus / IPC Combination Has a Clear Strategic Rationale
A Validus / IPC Combination Has a Clear Strategic Rationale Reinsurance industry capital and capacity has been materially depleted U.S. statutory surplus was down 11%, or ~$60 billion in 20081 Limited access to replacement capital and new capacity Disrupted capital markets and depressed valuations m
Slide 8: Transaction Yields Capital Efficiencies and Other Benefits
Transaction Yields Capital Efficiencies and Other Benefits More effective use of IPC aggregate Shift business away from nationwide accounts IPC generated $221.9 million in GPW from $1.25 billion of U.S. aggregate in 2008 Validus generated $431.3 million of GPW from $1.44 billion of U.S. aggregate in
Slide 9: Significant Increase in Scale and Market Presence
Significant Increase in Scale and Market Presence A Pro Forma Comparison of 6/30/09 Common Shareholders' Equity 1 Pro forma for Paris Re acquisition Source: SNL, PartnerRe Form PREM14A Filed 8/6/09, Validus pro forma analysis 1 70% Increase
Slide 10: Pro Forma 6/30/09 Balance Sheet
Pro Forma 6/30/09 Balance Sheet 1 Consists of hybrid junior subordinated deferrable debentures
Slide 11: Increased Float and Liquidity
Increased Float and Liquidity 1 As of August 7, 2009 2 Issued for IPC common shares, RSUs, PSUs, restricted shares and in-the-money options 3 All common shares excluding shares held by Founding Investors, Directors and Officers 1 2 Market value of float = $2.2bn pro forma (67% of market capitalizati
Slide 12: An Attractive Transaction for Validus Shareholders
An Attractive Transaction for Validus Shareholders Creates a leading Bermuda carrier in the short-tail reinsurance and insurance market with a global underwriting platform Superior long-term growth and return prospects Quality diversification in profitable lines Capacity to add a significant amount
Slide 13: Appendix: Non-GAAP Financial Measures
Appendix: Non-GAAP Financial Measures Book Value Per Share Analysis Capitalization Analysis 13 14
Slide 14: Book Value Per Share Analysis
Book Value Per Share Analysis
Slide 15: Capitalization Analysis
Capitalization Analysis (Sin thousands) ‘Total Debt Borrowings under credit facity Debentures payable Total Debt Total Capitalization Total shareholders equiy Borrowings under eredtfacity Debentures payable Total capitalization Total debt to total capitalization Debt (excluding debentures payable) t