Bermuda-based PartnerRe’s board of directors have secured a waiver from Axis Capital to engage with Italian investment company Exor after it submitted a rival bid of $137.50 per share.
The waiver, which allows for direct engagement with Exor with customary access, including due diligence, will be used to determine whether Exor’s offer can be improved so that it is compelling on price and terms.
In a letter sent to shareholders, PartnerRe’s board said: “However, at the same time, we believe it is important to set the record straight on our process to date and our decisions regarding the amalgamation agreement with Axis Capital and our rejection of Exor’s initial proposal. We believe our interactions with Exor to date have been severely distorted and mischaracterised by Exor.”
The board explained Exor was unwilling to be flexible on price, “a price which significantly undervalues PartnerRe compared to the benefits of the Axis transaction and our value as a standalone entity”.
However, in a meeting on April 18, 2015, the board unanimously agreed with the PartnerRe transaction committee’s recommendation to engage with Exor.
Jean-Paul Montupet, chairman of PartnerRe, said: “PartnerRe’s board of directors is open-minded and focused on creating value for our shareholders. Although we were disappointed that Exor has made misleading statements regarding our prior discussions, we are interested in a proposal that may lead to superior value for our shareholders.
“While we believe that PartnerRe is worth materially more than Exor has offered and the terms they have proposed are deficient, we stand ready to negotiate with Exor in good faith to determine their willingness to propose a transaction that, taking into account price, closing certainty, timing and other terms, is in the best interests of our shareholders.”
PartnerRe, Axis Capital, Exor, Bermuda, North America, Mergers & Acquisitions