Feb. 8 (Bloomberg) -- Alterra Capital Holdings Ltd. investors sued the company over its proposed $3.13 billion sale to property-casualty insurance provider Markel Corp.
The Louisiana Municipal Police Employees Retirement System filed a complaint today in Manhattan federal court against Alterra, its board and Markel. The retirement fund, suing on behalf of other investors in Alterra, alleged the company agreed to sell itself at an unfair price and misled shareholders.
A merger agreement filed with the U.S. Securities and Exchange Commission revealed that the deal, announced in December, “is the product of a flawed sale process,” lawyers for the Louisiana retirement fund said in the complaint.
“The merger agreement also reveals that individual defendants agreed to a number of oppressive deal protection devices designed to preclude any competing offers for Alterra,” the lawyers said in the complaint.
Bermuda-based Alterra, the eighth-largest publicly traded reinsurance provider, rebounded last year after stumbling amid high levels of catastrophic losses in 2011, according to the complaint. The company survived “in better shape than most of its peers,” and was on pace for financial growth when the merger with Glen Allen, Virginia-based Markel was announced, according to the complaint.
Bruce Kay, a representative for Markel, declined to comment. Susan Spivak Bernstein, a representative for Alterra, didn’t immediately return call seeking comment.
The case is Louisiana Municipal Police Employees Retirement System, 13-cv-933, U.S. District Court, Southern District of New York (Manhattan).
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