PartnerRe rejects EXOR again, to proceed with vote on AXIS merger

by Artemis on May 22, 2015

The board of reinsurance firm PartnerRe has once again rejected EXOR’s offer and also responded to what it calls EXOR’s rejection of its “good faith invitation to engage” and will now proceed with a shareholder vote on the AXIS Capital merger.

The move by PartnerRe’s board today could finally result in some closure on this M&A transaction, forcing shareholders to choose between the AXIS Capital merger or the all-cash offer from Italian holding company EXOR.

PartnerRe’s board explained; “By demanding that we declare their offer ‘reasonably likely to be a superior proposal’ as a precondition to any negotiations, EXOR has effectively rejected our Board’s good faith offer made yesterday to engage in discussions on price and other terms. We have made it very clear that EXOR’s price and terms are unacceptable.

“The waiver we obtained from AXIS to engage with EXOR contained no restrictions whatsoever that would impede full and open discussions and we remain interested to proceed on that basis to determine whether the offer can be improved so that it is compelling to PartnerRe shareholders on price and terms.

“EXOR’s portrayal in its letter of discussions between EXOR and PartnerRe is simply not credible. While it relates to an earlier proposal, and is not relevant to the latest offer, we point out one last time that we consider inaccurate EXOR’s statement that they did not portray their prior proposal as ‘best and final’.”

So once again the PartnerRe board has reiterated that it does not find the EXOR offer sufficient and that it favours the combination of PartnerRe and AXIS Capital.

As we wrote previously, the shareholder hold the key to this deal, and now finally it seems they will get to have their say. It would be interesting to see what the shareholders get to vote on, whether it is to vote for one of the two deals, or just to say yes or no to the AXIS deal. Which way such a vote is worded can have a strong bearing on the end result.

The PartnerRe board said that it will; “Proceed to shareholder approval of the transaction with AXIS Capital. The Board has not changed its recommendation with respect to, and continues to support, the pending merger with AXIS Capital.”

For PartnerRe and AXIS it will be a relief to have some closure of this issue in sight. For EXOR it now allows the PartnerRe shareholders to have a say as to whether the all-cash offer really is seen as attractive enough or not.

Should the shareholders vote against the AXIS deal it will then be fascinating to see what happens next. Such a vote could result in a desire to vote out the PartnerRe board, as they have been pushing for the AXIS route despite some major shareholders saying that the EXOR deal is superior.

Of course it could perhaps also result in EXOR walking away, feeling that PartnerRe has failed to take its offer seriously. That could, in the worst case scenario, leave the PartnerRe shareholders with no deal at all, an end result that none of them would likely desire to see happen.

For the full story see our previous articles, most recent first:

EXOR says will engage with PartnerRe board, but not on price.

AXIS prepared to go it alone if PartnerRe deal breaks up.

PartnerRe board wants improved EXOR bid, or it’s back to AXIS.

AXIS unlikely to sweeten PartnerRe offer to match EXOR: Reuters.

Shareholders hold key to PartnerRe’s future, EXOR bid preferred.

EXOR increases offer for PartnerRe, becomes largest shareholder.

Exor to consider increasing bid for PartnerRe, reports.

AXIS, PartnerRe committed on merger. EXOR commits to its offer.

Major shareholder prefers EXOR’s bid for PartnerRe over AXIS’.

EXOR bids $6.4B for PartnerRe, to get into reinsurance.

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