Investment group Exor said on Tuesday it has entered a memorandum of understanding (MoU) to sell its 100% stake in Bermuda-based reinsurer PartnerRe to France’s Covea for $9 billion in cash.
The announcement came nearly one month after Exor, the investment vehicle of Italy’s Agnelli family, and the unlisted French insurer said they had entered talks over a possible sale of PartnerRe.
Exor, whose portfolio includes controlling stakes in carmakers Fiat Chrysler and Ferrari and in industrial machinery firm CNH Industrial, bought PartnerRe in 2016 for a total price of $6.72 billion in cash, after a long, hostile takeover battle.
The MoU also includes a cash dividend of $50 million to be paid to Exor before the closing of the deal, expected by 2020-end, Exor said in a statement.
Exor Chairman John Elkann said in the statement that PartnerRe was a stronger company today.
“We have now been presented with an outstanding chance for PartnerRe to further strengthen its competitive advantage while providing important new opportunities for its people under Covea’s ownership,” he said.
The aggregate cash return for Exor following the completion of the deal would amount to $3 billion, including dividends paid by PartnerRe since 2016, the statement said.
Covea would enter into a definitive agreement to buy PartnerRe after it successfully completes a required consultation with workers councils, the statement added.
The French group said in a separate statement that it had approved the MoU with Exor, adding that the proposed acquisition of PartnerRe would enable it “to consolidate its diversification and internationalization, by creating a top tier European insurance and reinsurance group”.
Source: Reuters.com