“I believe, and hope you agree, that this timeframe is reasonable given the substantial time period you and the board have had to consider my earlier letter, even though for technical reasons you may not have been in a position at that time to be more forthcoming in responding to us,” Jain writes to Robert Orlich, president and chief executive of Transatlantic.

The offer will not be renewed if it isn't accepted and it will not be taken directly to shareholders, Jain adds.

Therefore, at the moment, any deal appears unlikely. Transatlantic says its preliminary estimate of book value per share is $69 to $70. The offer from National Indemnity “would not deliver fair value to [Transatlantic] stockholders,” the company says in a statement.

Transatlantic entered into a confidentiality agreement with National Indemnity and began talks after Transatlantic told National Indemnity its original $52 per share offer was not superior to the deal it had in place with Allied World.

But apparently nothing came of the talks and in the New York-based company's announcement that its merger with Allied World was called off, Transatlantic says it was not currently speaking to National Indemnity and no talks were scheduled.

With National Indemnity presumably out of the bidding for Transatlantic, Validus remains.

The Bermuda-based company's unsolicited cash-and-stock offer has been rejected by Transatlantic's board, negotiations have stalled over a provision in a confidentiality agreement, and the companies have filed lawsuits against each other.

Even with the Transatlantic-Allied World merger breakdown, rating agency Moody's says “conditions within the reinsurance industry are favorable for [mergers and acquisitions].”

Moody's adds in its Weekly Credit Outlook: “However, the termination of the Transatlantic and Allied World merger exemplifies the difficulties faced in an environment where most companies in the industry are trading significantly below book value. Cash buyers are seeking to get bargains at prices still well below book value, while stock-swap buyers lack a strong 'currency' and may not be able to offer enough premium to entice shareholders to sell as long as valuations remain depressed.”