Navigators will be on the hook to pay The Hartford a break fee of up to $68.2mn should the US specialty carrier receive a rival bid.

Navigators will be forced to pay 3.5 percent of the $2.1bn offer to The Hartford should another suitor come along after a 30-day “go shop” period expires.

If an offer is tabled within the next 30 days the break clause is set at 2 percent, which would land Navigators $40mn divorce bill.

Speaking on a call with analysts following the announcement of the acquisition earlier today (22 August), The Hartford’s CEO and chairman Christopher Swift said: “During the ‘go-shop’ period, it’s basically 2 percent and then there’s a what the deal lawyer’s call the ‘no-shop’ period that jumps up to 3.25 percent.”

“So view it as a 2 percent and if after 30 days, someone emerges, it goes up to 3.25 percent,” Swift added, according to a S&P transcript.

Swift said that during the “go-shop” window Navigators does have the opportunity to solicit rival proposals. “So we granted them that opportunity,” he said.

But Swift said he considers the deal – which values Navigators at $70 per share – a “fair value”.

“We negotiated, I think, a fair transaction for both parties,” he said. “We stand by what we negotiated.”

In response to questions from analysts, the chief exec said that he would not be drawn further on plans if another deal is tabled.

“I’m not going to speculate on what’s going to happen if any suitor emerges,” he said.