Exor, the Italian investment company that made a rival bid for Bermuda-based PartnerRe, has reaffirmed its commitment to pursue the reinsurer after the rejection of its bid.
Yesterday (May 4, 2015), PartnerRe’s board of directors reiterated its commitment to the planned merger with Axis Capital, following the approval of enhanced merger terms.
Axis enhanced its offer with the proposal of a one-time special dividend to PartnerRe shareholders of $11.50 per common share prior to the closing of the amalgamation agreement.
Exor said that it noted the decision by the PartnerRe board “to abandon its prior agreement and accept a revised but still inferior transaction from Axis Capital”.
Exor, which is controlled by the Agnelli family, submitted the proposal which would see the company pay $130 per PartnerRe share. This represents a 16 percent premium to the value offered by Axis, according to the investment company.
“In contrast, Axis' revised transaction still undervalues PartnerRe and is clearly not in the best interests of PartnerRe, its shareholders, employees and policyholders,” said Exor.
It added: “Exor’s proposal is financially superior, with no financing conditions, can be completed swiftly and will retain and build upon PartnerRe's highly talented management and employees.”
Exor believes that the revised terms of the agreement are a clear admission that Axis’ original transaction undervalued PartnerRe.
It added that the value of the proposed $11.50 extraordinary dividend is misleading.
“Since PartnerRe shareholders would own approximately 52 percent of a combined PartnerRe/Axis, the incremental value to the PartnerRe shareholders is less than half of the proposed dividend.”
Exor, PartnerRe, Axis, Europe, Bermuda, Mergers & Acquisitions