Covéa removed from 'under review' after it scraps $9bn PartnerRe deal

Ratings agency AM Best has removed from "under review with developing implications" status and affirmed the financial strength rating of A of French mutual insurer Covéa Coopérations.

This rating action follows the announcement that Exor and Covéa will not go forward with their planned transaction, under which Covéa would have acquired Exor’s outstanding common shares of Bermuda-based reinsurer PartnerRe.

Exor announced May 12 Covéa's "refusal to honour its commitments under the MoU". The two companies entered into "exclusive discussions" earlier in February 2020 regarding a possible all-cash acquisition of PartnerRe for $9 billion.

AM Best said it categorises Covéa’s balance sheet strength as "strongest, as well as its adequate operating performance, favourable business profile, and appropriate enterprise risk management".

The agency noted that the ratings factor in Covéa’ "strategic importance to Société de Groupe d’Assurance Mutuelle Covéa", a mutual insurance group in France. Covéa Coopérations is the intermediate holding company of Covéa’s operating entities and its principal inward reinsurance vehicle. Covéa Coopérations’ subsidiaries underwrite approximately 90 percent of the group’s consolidated premium and account for approximately 80 percent of the group’s consolidated capital.