PartnerRe agrees sale with Exor
After months of persistence, Exor has finally come to an agreement with PartnerRe to acquire the Bermuda-based reinsurer for $6.9 billion.
Exor will acquire all of the outstanding common shares of PartnerRe for an all-cash consideration of $140.5 per share, including a special pre-closing dividend of $3.0 per share.
Following the termination of the agreement with Axis Capital, PartnerRe will now pay Axis $315 million.
As previously mentioned, the agreement with Exor includes a ‘go-shop’ period during which the PartnerRe board is entitled to solicit and evaluate any competing offers to the Exor transaction and enter into negotiations related to proposals received prior to September 14, 2015.
Additionally, PartnerRe added that if it does not obtain a ruling from the IRS that the exchange of existing PartnerRe preferred shares for new preferred shares will not be treated as “fast-pay stock” for US federal income tax purposes prior to closing, Exor has agreed to pay, in lieu of the 100 basis point increase, $42.7 million in cash, in aggregate to record holders of PartnerRe preferred shares as of the effective time.
Jean-Paul Montupet, PartnerRe chairman, said: “We are pleased to reach this agreement with Exor, which we believe is in the best interest of our shareholders. Since Exor made its initial offer to acquire the company in April, 2015, the PartnerRe Board has been focused on maximising value for our shareholders while positioning PartnerRe for long-term success.
“We have carefully and thoroughly evaluated each development over the past several months, and believe that this thoughtful and deliberate approach was critical to delivering a transaction that represents a significant improvement in the price and terms of Exor’s original proposal.
“Importantly, Exor is committed to ensuring that the unique culture, brand and business that our dedicated employees have successfully built over the past 20 years remain intact.”
John Elkann, chairman and chief executive officer of Exor, said: “Today’s agreement is very positive for PartnerRe and Exor. Under our stable and committed ownership, PartnerRe will continue to develop as a leading independent global reinsurer.
“Exor looks forward to working with the board of directors and the management of PartnerRe to ensure a successful path forward. I would like to thank our fellow shareholders for their continuing support over recent months.”