Holding firm EXOR has increased the sales price of PartnerRe to French mutual insurance firm Covea by $328m.
In December 2021, Exor signed a definitive agreement to sell the reinsurance arm to Covéa for $9bn in cash.
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As per the agreement, the cash consideration of $9bn to be paid by the French insurer upon completion is based on consolidated common shareholders’ equity value of $7bn.
“Based on PartnerRe’s common shareholders’ equity at 31 December 2021, the agreed cash consideration will be adjusted, as per the agreed terms, to include additional proceeds for around $328m,” Exor’s statement read.
Of the $328m, Covea will pay $150m and the remaining $178m is to be paid by PartnerRe as a special dividend.
Notably, PartnerRe’s preferred shares listed on the New York Stock Exchange (NYSE) are not part of the deal.
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By GlobalDataWith this acquisition, Covea is looking to expand beyond the home, auto, life and health insurance markets.
The deal is yet to receive regulatory clearance from authorities and is expected to close in mid-2022.
As per the agreement, Exor will buy Covea’s stake in PartnerRe-managed special purpose reinsurance vehicles for nearly $725m.
These reinsurance vehicles will invest in property catastrophe and other short-tail reinsurance contracts underwritten by PartnerRe.
Furthermore, the firms will continue to invest in funds managed by Exor.
Exor, which is owned by Italy’s Agnelli family, had acquired PartnerRe in 2016 for a total cash consideration of $6.72bn.
