Bermuda-based PartnerRe has reiterated its recommendation of a merger with Axis Capital in a letter to its shareholders.
In the letter, PartnerRe’s board explained that if Axis and PartnerRe were to merge, it would result in “one of the premier performing companies in insurance and reinsurance”.
The board added: “The combined company will be an industry powerhouse with increased scale and relevance. The company will have gross premiums written in excess of $10 billion, approximately $13 billion of combined shareholders’ equity, as well as cash and invested assets of more than $31 billion.”
Previously, PartnerRe and Axis pledged to return $750 million to company shareholders following the proposed merger. This is in addition to the $560 million dividend offered to PartnerRe’s investors.
By the end of 2017, the combined company expects to return as much as $2.2 billion to shareholders through buybacks and dividends, equivalent to 100 percent of operating earnings.
In its latest letter to shareholders, the board warned shareholders against being misled by Exor’s “false rhetoric and incorrect assertions”.
“Furthermore, Exor has rejected our board’s good faith offer to engage in discussions and has made it abundantly clear that it is not willing to adjust the price or terms of its offer. As we have noted previously, not only is the price inadequate, but the terms of the offer create significant and unacceptable levels of execution risk and are not in the best interests of our shareholders,” said PartnerRe.
The special meeting of PartnerRe shareholders is scheduled for July 24, 2015.
PartnerRe, Axis, Exor, Europe, Bermuda, Mergers & Acquisitions