PartnerRe Board says EXOR’s offer likely superior, but still prefers AXIS

The Board of reinsurance firm PartnerRe responded to the latest improved offer from Italian investment holding company EXOR, saying that it acknowledges that the offer is reasonably likely to result in a “Superior Proposal”, but added that it still prefers the planned merger with AXIS Capital.

Update: AXIS Capital also said that it still prefers the merger scenario, but at the same time it said it has halted all integration work until the outcome is better understood.

It’s the latest twist in this three-way reinsurance merger tussle between the parties, but this is now the first time that PartnerRe’s Board has acknowledged that the deal with EXOR could be a superior offer, in transaction terms.

The PartnerRe Board said that it in response to the revised and enhanced offer submitted yesterday by EXOR, which the reinsurance firm Board notes is the sixth such revision, it has “determined that the latest EXOR proposal would reasonably be likely to result in a “Superior Proposal” (as defined in the Amalgamation Agreement with AXIS Capital).”

As a result of the EXOR deal now qualifying as a “superior proposal” the PartnerRe Board said that it will seek to engage with EXOR, offering the investment conglomerate the option to conduct due dilligence, as well as to “determine whether the current offer can be improved both in its price and terms with respect to items previously identified.”

However, the Board of PartnerRe said that it “continues to believe that the transformative amalgamation with AXIS Capital is superior in value, terms and certainty of closing to the current EXOR proposal.”

That means that PartnerRe is not doing anything to jeopardise the merger with insurance and reinsurance firm AXIS Capital, continuing to encourage its sharholders to vote for that deal over the EXOR offer. This despite having finally invited EXOR to the table.

For EXOR this must be seen as both a step in the right direction, with the Board of PartnerRe finally acknowledging its offer as potentially superior, but also disappointing that with a superior offer on the table the PartnerRe Board continues to push for the AXIS deal.

That’s likely to result in further back and forth, we’d imagine, with more announcements likely in the next day or so.

Just when you thought we could be nearing the end game, this reinsurance M&A saga looks set to keep generating the headlines.

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

– EXOR adds another $3 per common share to PartnerRe offer

– Enhanced PartnerRe – AXIS terms weaken merger rationale: Analyst.

– PartnerRe and AXIS reveal improved merger terms.

– EXOR says PartnerRe & AXIS acknowledge transaction is inferior.

– PartnerRe and AXIS Capital evaluate improving merger deal.

– As EXOR pursues PartnerRe, AXIS could attract buyer: Macquarie.

– Activist Sandell says PartnerRe board misinforming shareholders.

– AXIS needs to match, or beat, EXOR’s improved PartnerRe offer.

– EXOR enhances deal terms for PartnerRe shareholders.

– PartnerRe unimpressed with EXOR’s expanded completion guarantee.

– EXOR sweetens PartnerRe offer with completion guarantee.

– EXOR says receiving positive response from PartnerRe shareholders, plus updates from both sides.

– PartnerRe cites inadequate price, unacceptable risk of EXOR offer.

– Confusion over whether Arch is bidding for AXIS, or not.

– KBW analysts still give AXIS the edge to win PartnerRe deal.

– Arch said to be considering AXIS Capital bid: Reports.

– Analysts feel EXOR has improved chance of buying PartnerRe.

– EXOR capital structure has no bearing on PartnerRe rating: S&P.

– EXOR accuses PartnerRe board of “engineering” AXIS transaction.

– PartnerRe Board urges Preferred Shareholders to vote for AXIS merger.

– Bermuda court rules against Exor’s shareholder detail request.

– PartnerRe shareholders should vote to go with AXIS: KBW analysts.

– PartnerRe says Exor’s lawsuit claims “without merit”.

– Exor sues to gain access to PartnerRe shareholder details.

– PartnerRe-AXIS : $60m fees from third-party reinsurance capital by 2017.

– EXOR welcomes PartnerRe shareholder vote, Sandell questions Board.

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

– 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.