PartnerRe to discuss possible merger with Italy's Exor
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PartnerRe Ltd. on Wednesday said it will enter discussions with the board of Exor S.p.A. — the Italian investment firm that made a bid for the reinsurer after it had agreed to merge with Axis Capital Holdings Ltd. — to see if the firms can agree to terms for acquisition by Exor.
In the same statement, however, PartnerRe said, “The board has not changed its recommendation with respect to, and continues to support, the pending merger with Axis Capital.” Both companies are based in Pembroke, Bermuda.
PartnerRe said its board of directors “has determined that it is prepared to engage in discussions with Exor S.p.A. to determine whether Exor's offer, received on May 12, 2015, to acquire all of the outstanding common shares of PartnerRe for $137.50 per share in cash can be improved so that it is compelling, on price and terms, to PartnerRe's shareholders.”
Axis responded to the initial Exor bid by declaring a one-time special dividend of $11.50, to which Exor then responded with its higher bid.
Exor most recently increased its bid to $137.50 per share in cash from $130 per share, valuing PartnerRe at $6.8 billion. Exor's initial bid disrupted plans for PartnerRe to merge with Axis to form the world's largest reinsurer.
PartnerRe said it has secured a waiver from Axis to engage with Exor. There is a breakup fee of $250 million that PartnerRe would have to pay Axis associated with the noncompletion of the merger of Axis and Partner.
“There can be no assurance that the discussions with Exor will result in a transaction that the PartnerRe Board is prepared to recommend or that there will be a consummation of a transaction,” PartnerRe said in its statement.
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