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Long courtship, rocky breakup led to PartnerRe takeover

Long courtship, rocky breakup led to PartnerRe takeover

A proxy statement filed by PartnerRe Ltd. on Tuesday shows the company looked at its options and future as early as 2013, more than a year before the beginning of a takeover drama culminating in the firm's purchase for $6.8 billion by Italian investment firm Exor S.p.A.

Though it did not end up producing a deal, the courtship between Pembroke, Bermuda-based PartnerRe and Axis Capital Holdings Ltd. began in late 2014, before the companies' January 2015 announcement they would merge.

“During 2013 and 2014, the PartnerRe board of directors reviewed and considered the then-current and future industry trends and risks to PartnerRe's ability to execute its strategic plan as a stand-alone entity,” read the company's proxy filing with the U.S. Securities and Exchange Commission.

The company even considered making an acquisition in late 2013 and formed a “transaction committee” to study the proposal, which never materialized.

“In September 2013, the senior management of PartnerRe presented a possible strategic acquisition candidate to the PartnerRe board of directors,” read the proxy filing.

In early 2014, then-CEO Costas Miranthis held “preliminary discussions” with a potential acquirer.

Subsequently, however, “the PartnerRe board of directors directed senior management to consider other possible responses to the trends in the industry, including potential acquisitions and strategic options and to report their findings to the PartnerRe board of directors,” read the filing.

The board then considered “various strategic options,” including potential transactions, at its September and November 2014 board meetings. These discussions included Axis among potential candidates according to the filing.

It was in December 2014 that PartnerRe Chairman Jean-Paul Montupet and Axis Chairman Michael Butt first held “initial discussions.”

Shortly after that, the companies announced plans to merge, only to be trumped eventually by Exor, which entered the fray in April with a $6 billion all-cash offer for PartnerRe and wound up buying the reinsurer in a $6.8 billion all-cash deal announced Aug. 3.

Exor's initial contact was made April 14, the documents show, when Exor Chairman John Elkann contacted Mr. Montupet.

“On April 14, 2015, at the agreed upon time, Mr. Montupet received a call from Mr. Elkann, chairman and CEO of Exor. Mr. Elkann told Mr. Montupet that later that day, Exor would publicly announce a proposal to acquire 100% of the common shares of PartnerRe on a fully-diluted basis for $130.00 in cash per share,” read the filing.

Axis and Exor then traded barbs, each side enhancing its offer leading to the Aug. 2 conclusion.

Partner and Exor executed a confidentiality agreement on July 31, the filing shows, and the companies' boards held a telephone meeting Aug. 2 which sealed the deal, announced the next day.

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