Proxy adviser Institutional Shareholder Services Inc. said
Friday that PartnerRe Ltd. shareholders should vote against a $11
billion merger with Axis Capital Holdings Ltd. because the all-cash
offer from Italian investment group Exor SpA is more favorable.
Including a recently added $3 dividend, Exor's offer for
PartnerRe would be valued at $140.50 a share. In comparison, Axis's
offer values ParnerRe at about $139, based on Friday afternoon
trading.
ISS said the Exor offer gives shareholders greater certainty of
value and represents a healthy 23% premium to PartnerRe's
unaffected stock price on Jan. 23.
ISS also said it is unlikely that Exor's bid would be derailed
by regulatory review, because of Exor's ample resources and prior
ownership of an insurance business.
ISS added that a private-letter ruling for a merger, favored by
PartnerRe and Axis, is likely to result in shrinkage of PartnerRe
employees. Unlike Axis, ISS said there is little business overlap
between Exor and PartnerRe that would result in employee loss due
to efficiencies.
Earlier this week, PartnerRe and Axis reaffirmed their
commitment, saying Exor's latest offer for PartnerRe could subject
preferred shareholders to an onerous annual reporting and penalty
regime.
PartnerRe also has insisted in the past that Exor's offer was
inferior because the Axis deal offered cost savings of at least
$200 million as well as potential revenue and capital benefits.
Write to Neil Haggerty at neil.haggerty@wsj.com
Access Investor Kit for AXIS Capital Holdings Ltd.
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