SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 4, 1996
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ACE LIMITED
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(Exact name of registrant as specified in its charter)
Cayman Islands 1-11778 Not Applicable
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
The ACE Building
30 Woodbourne Street
Hamilton, Bermuda HM 08
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including are code: (441) 295-5200
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Not Applicable
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(Former name or former address, if changed since last report)
Item 5. Other Events.
On June 4, 1996, ACE Limited (NYSE: ACL) ("ACE") issued a
press release relating to the unsolicited offer by IPC Holdings,
Ltd. to acquire Tempest Reinsurance Company Limited.
Included as Exhibit 99.1 to this Current Report on Form 8-K is
a copy of the press release referred to above.
Item 7. Exhibits.
99.1 Press Release, dated June 4, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
ACE LIMITED
Dated: June 4, 1996
By: /s/ Christopher Z. Marshall
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Christopher Z. Marshall
Executive Vice President and
Chief Financial Officer
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EXHIBIT INDEX
Exhibit Sequential
Number Description Page No.
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99.1 Press Release, dated June 4, 1996
FOR IMMEDIATE RELEASE Investor Contact: Helen M. Wilson
Investor Relations
ACE Limited
(441) 299-9283
ACE LIMITED REITERATES ITS COMMITMENT TO ACQUIRE TEMPEST
HAMILTON, BERMUDA -- June 4, 1996 -- ACE Limited (NYSE: ACL)
announced today that it has been advised by Tempest Reinsurance
Company Limited ("Tempest") that Tempest has received an
unsolicited offer from IPC Holdings, Ltd. (NASDAQ/NMS: IPCRF)
("IPC") to acquire Tempest. Under IPC's proposal, which is
subject to a number of contingencies, Tempest shareholders would
receive cash and common shares.
ACE's Chairman, President and Chief Executive Officer,
Brian Duperreault, stated that, "We remain commiteed to acquiring
Tempest and are convinced that the ACE/Tempest combination is
superior for Tempest shareholders. The IPC proposal is subject to
a number of contingencies and uncertainties including the following:
. The value of the IPC shares to be issued under the IPC
proposal is uncertain. Because the IPC proposal
contemplates a closing at the end of September, nearly
four months away, Tempest shareholders are subject to
the risks of substantial movements in the price of IPC
shares. The ACE/Tempest transaction is due to close,
subject to shareholder approval, on or about June 19,
1996, and thus the value of the ACE ordinary shares to
be received by Tempest shareholders is subject to much
less uncertainty.
. During the four-month period prior to the proposed
closing of the IPC transaction, Tempest and its
shareholders would be exposed to a number of business,
financial and market uncertainties. As a portion of
the consideration to be paid by IPC is subject to
Tempest's results for the period between March 31, 1996
and the closing date, any adverse business, financial
or market developments could decrease the consideration
to be received by Tempest shareholders. This period
encompasses the traditional Atlantic hurricane season.
The ACE/Tempest transaction is subject to much less
uncertainty due to the expected June 19 closing date.
. The IPC proposal contemplates the issuance of a
substantial number of additional IPC shares. There is
significant uncertainty as to the effect of this
issuance on the long-term market price of the IPC
shares. The ACE/Tempest transaction contemplates the
issuance of ACE ordinary shares representing less than
30% of the currently outstanding ACE ordinary shares.
Furthermore, the market has had an opportunity to
evaluate the ACE/Tempest transaction, including the
issuance of additional ACE ordinary shares, the effect
of which ACE believes has been reflected in the
current market price of ACE's ordinary shares.
. Under the IPC proposal, Tempest shareholders would own
shares of an even more concentrated monoline property
catastrophe reinsurer than before. Under the
ACE/Tempest transaction, Tempest shareholders would own
freely tradeable shares in a large, diversified
international property and casualty insurance company.
. IPC's proposal is subject to a due diligence review of
Tempest, negotiation of a definitive agreement and
other conditions precedent. ACE has already completed
its due diligence review and entered into a definitive
agreement and is prepared, subject to shareholder
approval, to consummate its transaction on June 19."
As disclosed in IPC's press release, the IPC proposal is
subject to termination of the agreement between ACE and Tempest.
Under such agreement, Tempest's board of directors may only
terminate the agreement if it determines in its good faith
reasonable judgment that the IPC proposal provides greater
aggregate value to Tempest and/or its shareholders than the ACE
transaction, or any improved transaction proposed by ACE, and
then only upon payment to ACE of a $12 million termination fee.
Mr. Duperreault stated that "we believe that our proposal is
superior and expect that Tempest's board of directors will
reach the same conclusion and restate its support for our transaction."
On March 14, 1996, ACE and Tempest entered into an amalgamation
agreement pursuant to which Tempest would be acquired by ACE and the
shareholders of Tempest would receive ACE ordinary shares. ACE and
Tempest have set June 19, 1996 as the date of the shareholder meetings
to vote on matters related to the transaction.
The ACE group of companies specializes in catastrophe insurance for
a diverse group of international clients. ACE Limited's Bermuda
subsidiaries are leading providers of high level excess and directors and
officers liability insurance and also provide satellite, aviation, excess
property and financial lines coverages. ACE owns a majority interest in
Methuen Group Limited and provides corporate capital to Lloyd's syndicates
managed by Methuen's managing agency. At March 31, 1996, ACE Limited had
over $1.5 billion in shareholders' equity and $3.5 billion in assets.
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