PartnerRe Offers Correction to EXOR's Misleading Release Related to Co.'s Preferred Shares: Confirms S&P Has Not Provided View of Ratings

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PartnerRe Ltd.
PRE
today corrected recent misleading statements made by EXOR regarding PartnerRe's ratings in the event of a sale to EXOR. EXOR's June 16, 2015 release implies that EXOR had received official guidance from Standard and Poor's ("S&P") on the ratings of PartnerRe under potential EXOR ownership. PartnerRe believes it is imperative to make clear the following facts: S&P Has NOT Provided a View on PartnerRe's Ratings in Relation to a Sale to EXOR S&P has not taken a view nor has it made any public statements regarding the credit or financial strength ratings of PartnerRe in the event of an EXOR acquisition. EXOR's statements with regard to PartnerRe's potential credit ratings are misleading, and do not reflect the views of S&P or S&P's analyst for PartnerRe. PartnerRe does not anticipate that S&P will comment on the potential rating implications of a hypothetical EXOR acquisition of PartnerRe unless and until a definitive merger agreement is in place. S&P Has Provided a View on EXOR's Ratings in Relation to a Potential Acquisition of PartnerRe – It has Revised its Outlook on EXOR's Ratings to "Negative" S&P revised its outlook on EXOR's credit rating to "Negative" following its unsolicited offer to acquire PartnerRe due to EXOR's increased indebtedness associated with financing the proposed acquisition. As S&P stated on April 17, 2015: "The [EXOR] negative outlook reflects our view that if the PartnerRe acquisition is completed, EXOR's LTV [loan-to-value] may exceed our 20% threshold for the ratings. It also reflects our view that EXOR's listed assets may fall below 60% of total assets, which we believe would not be commensurate with our current assessment of a ‘satisfactory' business risk profile." S&P Has Affirmed PartnerRe's Ratings With a Stable Outlook in the Context of the AXIS Merger As S&P stated on March 13, 2015: "We are affirming all of our ratings on AXIS and PartnerRe and their respective operating companies… The stable outlook reflects our view that, after the deal closes, the consolidated group will maintain a very strong capitalization redundant at the 'AA' level. We also expect the group to strengthen its very strong competitive position supported by a diverse product portfolio." The preferred shares of the merged PartnerRe/AXIS will be supported by a stronger combined balance sheet, increased equity base and enhanced, more stable earnings. A potential sale of PartnerRe to EXOR presents significant uncertainties to preferred shareholders and creditors, which would need to be evaluated by all four ratings agencies (S&P, Moody's, A.M. Best and Fitch). Unlike common shareholders, perpetual preferred shareholders and creditors would retain a continuing interest in PartnerRe post-acquisition by EXOR. Preferred shares would be a fundamentally different security if PartnerRe were owned by EXOR vs. merged with AXIS: Wholly owned subsidiary of diversified financial investor vs. independent enterprise solely focused on reinsurance / insurance. Directly exposed to parent company decisions about management, dividend policy, enterprise risk profile which may be driven by factors extraneous to insurance markets. Indirectly exposed to financial condition of sister companies Fiat Chrysler Automobiles ("FCA") and CNH Industrial – non-investment grade rated industrial entities that are marginally profitable and capital intensive and cyclical. More limited access to capital following a major catastrophe as a wholly-owned subsidiary of EXOR vs. remaining as a publicly listed company when merged with AXIS. Notwithstanding EXOR's assertions, PartnerRe's credit standing and ratings will be impacted by developments at EXOR and vice versa. Rating agency communications are clear on this point and are supported by rating methodologies for operating holding companies. PartnerRe continues to believe that there is considerable downside risk involved in a sale to EXOR, on its current price and terms, especially for preferred shareholders. The PartnerRe Board of Directors continues to urge its shareholders of both common and preferred shares to promptly use the white proxy card to vote FOR the Amalgamation Agreement with AXIS Capital at the Shareholder Meeting on July 24, 2015. Shareholders with questions about how to vote their shares may call Innisfree M&A Incorporated at (877) 825-8971 (toll-free from the U.S. and Canada) or +1-412-232-3651 (from other locations.) Additional information is available on PartnerRe's website and on www.partnerre-valuecreation.com.
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