A storm is brewing over the pricing for the proposed merger involving a Bermudian-based investment holding company and one of the oldest investment companies in the British market.

A bloc of investors in Ocean Wilsons Holdings Ltd believe that what Hansa Investment Co Ltd is offering them for their shares is wholly inadequate.

The two sides have been publicly trading correspondence on the matter since last week, but representatives for the unhappy investors today said they still intend to vote against the deal.

Arnhold LLC, an investment manager of client accounts that collectively own over 900,000 shares of Ocean Wilsons, issued an open letter to fellow shareholders detailing its rationale for rejecting the proposed all-share combination at the planned meeting of Ocean Wilsons shareholders on September 12.

It reads: “Arnhold is concerned that the proposed combination is deeply flawed and unfair to the shareholders of Ocean Wilsons, and will result in a serious diminution of value.”

Arnhold’s view is that the deal grossly undervalues Ocean Wilsons' shares and would be detrimental to Ocean Wilsons shareholders.

In particular, Arnhold's calculations indicate that the combination does not reflect the appropriate contribution of each company.

Ocean Wilsons hit back “to address and correct a number of misleading and inaccurate statements” made by Arnhold.

It said some of the issues raised were “considered and comprehensively addressed” in private meetings and correspondence.

“Given the extent of this private engagement, Ocean Wilsons was extremely disappointed to see the number of misleading and inaccurate assertions made by Arnhold in the open letter.”

The Ocean Wilsons independent committee said benefits of the transaction include the creation of a meaningfully-scaled investment with net assets in excess of £900 million (about $1.2 billion) and a diversified, global portfolio of investment funds, direct equities and private assets, which would be well-positioned to take advantage of investment opportunities across global markets.

The response also noted the complementary nature of the two investment portfolios and the potential for cost efficiencies.

Ocean Wilsons further stated that the independent committee considers the terms of the combination to be fair and reasonable, and has unanimously recommended that shareholders vote in favour of the transaction.

A follow-up statement from Arnhold to all shareholders today said: “We disagree with the assertion in Ocean Wilsons’ response that our Arnhold letter contained a number of misleading and inaccurate assertions. To the contrary, we stand behind the assertions in the Arnhold Letter.

“We believe the Ocean Wilsons’ response is inadequate and is simply an attempt to distract from what we consider to be the underlying unfairness of the proposed combination. We continue to be concerned that the proposed combination is deeply flawed and unfair to the shareholders of Ocean Wilsons, and will result in a serious diminution of value.

“Accordingly, Arnhold still intends to vote against the combination at the scheme meeting on September 12. Your vote is vital to preventing a value-destructive merger between Ocean Wilsons and Hansa.

“We urge shareholders to inform themselves of all relevant available information regarding the merits of the combination, including considering the recommendations of independent proxy advisory firms that have reviewed the combination and have formulated their recommendations with respect to whether to vote for or against the merger.”