NEW YORK (Reuters) — Endurance Specialty Holdings Ltd is considering increasing its offer to acquire rival reinsurer Aspen Insurance Holdings Ltd to around $50 per share, or roughly $3.26 billion, people familiar with the matter said.

Aspen rejected Endurance’s initial cash-and-stock offer for $47.50 per share in April, which valued the Bermuda-based reinsurer at $3.1 billion and represented a premium of about 21 percent to its unaffected share price.

In addition to raising its takeover bid, Endurance may also increase the amount of cash it will put into the deal, the people said, asking not to be named because the matter is not public.

It is not known when any sweetened offer would be made, but the timing is not imminent, one of the people said. Endurance is scheduled to release first quarter earnings after the market close on Monday.

Representatives for both Endurance and Aspen declined to comment. Shares of Aspen were trading at around $45.10 on Monday afternoon.

Initially, Endurance said it would fund the proposed acquisition partly through proceeds from a $1.05 billion placement of new shares to investors led by private equity firm CVC Capital Partners Ltd.

A further increase of the cash portion of the offer could be funded by debt or cash on hand, one of the people said.

Endurance’s initial bid represented 1.16 times Aspen’s book value per share, based on the target company’s year-end numbers. However, Aspen on March 31 reported an increase of 4.4 percent to its diluted book value per share.

Therefore, any sweetener from Endurance would have to outpace Aspen’s organic growth, according to the people familiar with the matter.

Endurance and Aspen compete in the reinsurance industry which also counts Validus Holdings Ltd, Axis Capital Holdings Ltd and Allied World Assurance as major players.

It was not clear if any of the other competitors are interested in entering the fray.

The reinsurer industry faces pressure to consolidate because larger reinsurers can serve larger clients and enjoy economies of scale.

In addition, traditional reinsurers have been facing increased competition from alternative products such as catastrophe bonds and other instruments. Several of the sources said this is also a driver of consolidation activity.

Morgan Stanley & Co and Jefferies LLC are acting as financial advisers to Endurance, while Goldman Sachs is advising Aspen.