The board of Bermuda-based reinsurer IPC Holdings Ltd. remains opposed to Validus Holdings Ltd.'s takeover offer and is negotiating with other potential suitors.

Yesterday, IPC said it had made some progress in discussions with Validus, but added its Bermuda rival had refused to raise its offer.

Meanwhile Validus said it was pushing ahead with its amalgamation plan and was trying to convene a meeting of IPC shareholders with the aim of ousting the IPC board.

IPC had planned to merge with Max Capital Group Ltd., another Bermuda company, in a deal that would have created the sixth largest global underwriter in the Bermuda market.

But IPC shareholders voted against the deal in the company's annual general meeting on June 12, after Validus had made a rival hostile takeover bid, which included a cash payment of $3.75 per share for IPC shareholders.

IPC chairman Kenneth Hammond said the company had talks with Validus after the Max deal was voted down in an attempt to arrive at an agreement the board could recommend to shareholders.

Although some progress was made, Mr. Hammond said that "Validus thus far is not willing to move on the key issue of price". He added that Validus' offer price was down by nearly 10 percent since the AGM and represented a 22 percent discount to IPC's May 31, 2009 book value.

"Validus' stock price has also declined by 16 percent since Validus's initial offer for IPC on March 30, 2009, reducing the premium to IPC shareholders to a mere three percent," Mr. Hammond added.

"IPC's board continues to recommend against the current Validus offer. At the same time, we are willing to work with Validus and encourage Validus to improve the terms of its offer."

In yesterday's statement, IPC said it had invited offers from other companies, had received some "expressions of interest" and was "engaged in discussions and negotiations with other parties".

IPC, whose business has a heavy emphasis on property-catastrophe reinsurance, made it clear that it was looking to move quickly, otherwise it would continue its review of options after the hurricane season.

"In the event that an appropriate transaction is not agreed to and completed in the very near future, IPC will continue, as it has for the past 15 years, as a stand-alone company," Mr. Hammond said.

He added: "We believe a comprehensive review of all alternatives for value maximisation post-hurricane season would allow for a greater number of potential interested parties as well as greater certainty of value and timing of closing a deal."

Mr. Hammond said IPC had started looking for a new chief executive officer to replace industry veteran Jim Bryce, who will retire at the end of this month.

Validus said in a statement released on Monday night that it had delivered a revised amalgamation agreement to IPC to address some concerns of the IPC board, but that it would not raise its price.

"We have offered a number of concessions to IPC to be responsive to their stated concerns, including allowing IPC's board the right to perform a limited market check after the signing of an agreement with Validus, eliminating the book value termination right so that the closing will not be affected by catastrophe risk, and agreeing to an enhanced severance plan for IPC employees.

"However, none of the information that we have received from IPC would justify changing the economic terms of our offer.

"By overwhelmingly rejecting the Max transaction, we believe that IPC's shareholders sent a strong message to the IPC board that they want the attractive economics of the Validus offer. We urge IPC's board to heed that message and agree to Validus' revised amalgamation agreement without delay."

If no agreement is reached with the IPC board, Validus said it would seek to replace the IPC directors at a special meeting of IPC shareholders.

Under the terms of the Validus offer, IPC shareholders would receive $3.75 in cash and 1.1234 Validus shares for each IPC share, totalling $27.26 per share based on Validus' closing stock price on Monday. IPC shares rose 39 cents yesterday to close on $26.90, while Validus climbed 85 cents to $21.78.