Converium urges shareholders to reject SCOR bid

ZUG, Switzerland—Converium Holding Ltd. has urged its shareholders to reject the takeover bid made by its French rival SCOR S.A. and says a deal could result in a loss of business of up to $800 million.

Converium will—after the financial markets close on Saturday—publish an official board response to the tender offer made by SCOR last week for the shares in Converium held by the public.

SCOR, which holds a 32.9% stake in Zug, Switzerland-based Converium, has bid $2.5 billion in cash and shares for control of the company.

Converium said in a statement that it urged shareholders to reject SCOR's offer, which it said undervalues the company.

Converium said its board believed its franchise would be damaged by the hostile nature of the bid, which threatened to "undermine the stability of SCOR's shares."