Covéa has pulled the plug on its planned acquisition of PartnerRe, formalised in a memorandum of understanding (MoU) that was announced on March 3, 2020.
Exor, the parent company of PartnerRe, said Covéa was attempting to renegotiate the agreed deal terms, as outlined in the MoU. “Covéa has never suggested the existence of a material adverse change, including pandemic risk, or any other issues at PartnerRe, that would explain its refusal to honor its commitments under the MoU, and Exor believes that no such basis exists,” Exor said.
Exor stressed it did not believe a sale of PartnerRe on terms inferior to those established in the MOU, represented good value for the business. PartnerRe has a positive outlook, with one of the highest capital and liquidity ratios in the global reinsurance industry, Exor said. The business is not expected to be significantly affected by the COVID-19 outbreak, it added.
Benjamin Serra, an analyst at Moody’s, said: “The cancellation of the PartnerRe acquisition is a missed opportunity for Covéa to significantly diversify its business profile. However, this decision will allow the group to maintain a very high level of solvency and to absorb, without difficulty, the shocks resulting from the coronavirus outbreak.”
Covéa, PartnerRe, Exor