AXIS Capital Holdings Ltd., the insurer that agreed to merge with PartnerRe Ltd., jumped in New York trading on speculation that the deal could fall apart, which could put AXIS in play to be taken over by another company.
EXOR SpA, the investment firm that made a hostile $6.8 billion bid for PartnerRe, said in a statement Tuesday that the target company’s preferred shares would retain their BBB credit rating from Standard & Poor’s if a takeover is completed. That could encourage PartnerRe investors to vote against the combination with Bermuda-based AXIS.
“The more likely it becomes that the AXIS-PartnerRe merger gets voted down by PartnerRe shareholders, the more likely it becomes that someone makes a play for AXIS,” Charles Sebaski, an analyst at BMO Capital Markets, said by e-mail. He cited the deal this month by Tokio Marine Holdings Inc. to buy HCC Insurance Holdings Inc. as an example of insurers’ search for consolidation.
AXIS climbed 4.6 percent to $57.91 at 2:50 p.m. Bermuda- based PartnerRe advanced 1.7 percent. Turin-based EXOR gained 1 percent in Italy.
A representative for S&P didn’t immediately return a message seeking comment.
Related:
Update: Bermuda Court Rules in Favor of PartnerRe; EXOR Responds
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