White Mountains Insurance Group Ltd is aiming to buy back up to half of a million of its common shares, valued at more than $400 million, in a “modified Dutch auction”.

Through the self-tender offer, the Bermudian firm will give shareholders the opportunity to part with shares for a cash payment of between $825 and $875 per share.

On Wednesday, White Mountains closed at $850.65 in New York trading.

The announcement of the tender came in a filing with the Bermuda Stock Exchange.

Companies frequently use excess capital to buy back their own shares for cancellation, in order to boost the value of each share.

The buyback announcement was welcomed by investors, as White Mountains stock climbed more than 2 per cent to as high as $869.42 in morning trading on the Nasdaq Stock Exchange.

“The self-tender offer allows shareholders to indicate how many shares and at what price within the company’s specified range they wish to tender their shares,” White Mountains said in a statement.

“Based on the number of shares tendered and the prices specified by the tendering shareholders, the company will determine the lowest price per share within the range that will enable it to purchase 500,000 shares or such lesser number of shares that are properly tendered.”

The company will determine the purchase price, based on the results of the offer. No shareholder will be paid less than their agreed selling price, but some may be paid more.

The offer opened yesterday and is expected to expire at 12 midnight, New York time, at on September 14, 2017, unless extended.

The company, nor its directors, made any recommendation as to whether any shareholder should participate.

DF King & Co is information agent for the tender offer. Shareholders with questions, or who would like to receive additional copies of the tender offer documents when they are available, may call D.F. King & Co at (800) 893-5865 (toll free) or e-mail wtm@dfking.com