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PartnerRe spurns Exor, proceeds with Axis vote

PartnerRe will ask shareholders to vote on a planned merger with Axis Capital Holdings after hostile bidder Exor declined to raise its $US6.8 billion ($8.58 billion) offer.

“By demanding that we declare its offer ‘reasonably likely to be a superior proposal’ as a precondition to any negotiations, Exor has effectively rejected our board’s good faith offer… to engage in discussions on price and other terms,” Bermuda-based PartnerRe said on Friday.

“We have made it very clear that Exor’s price and terms are unacceptable.”

Exor earlier declared it would not increase its bid price but was willing to negotiate with the reinsurer, and PartnerRe had indicated a willingness to talk with Exor to see if the takeover price and terms could be improved.

However, in a letter to the reinsurer’s board, Exor Chairman and CEO John Elkann said his group was only willing to talk if PartnerRe’s board declared its offer superior to that of Axis.

“Exor will not consider increasing the price of its binding offer,” the letter said.

PartnerRe Chairman Jean-Paul Montupet says the reinsurer is worth “materially more” than Exor has offered and the proposed terms are deficient.

Exor, a holding company that owns a controlling stake in carmaker Fiat Chrysler, initially offered $US130 ($164.09) cash per share for PartnerRe, in a $US6.4 billion ($8.07 billion) bid.

It then increased the bid to $US137.50 ($173.52) a share, or $US6.8 billion.

In January Axis and PartnerRe agreed a merger to create a new reinsurance player capitalised at more than $US11 billion ($13.88 billion).