Significant events

Significant events in the first half of 2015 and subsequent events

Line of credit extended to Juventus Football Club

In January 2015 EXOR approved the opening of a line of credit to the subsidiary Juventus Football Club for a maximum of €50 million, with effect from February 1, 2015 and expiring on December 31, 2015, at an interest rate equal to the one-month Euribor plus a spread of 2%.
The opening of the credit line has enabled EXOR to invest a part of its short-term liquidity at an interesting rate of return.
At June 30, 2015 this line of credit is utilized for €38 million.

Agreement for the sale of the investment in C&W Group

On May 11, 2015 EXOR announced that an agreement had been reached for the sale of Cushman & Wakefield to DTZ, a company held by TPG Capital PAG Asia Capital and the Ontario Teachers’ Pension Plan. The transaction recognizes a total enterprise value for Cushman & Wakefield of $2,042 million; this will generate proceeds of $1,278 million and a gain of approximately $722 million for EXOR S.A. The closing of the deal is expected in the third quarter of 2015 subject to customary closing conditions and receipt of regulatory approvals.

Resolutions passed by the general meeting of the shareholders on May 29, 2015

The shareholders’ meeting held on May 29, 2015 approved the payment of dividends of €0.35 per share for a maximum total of €77.8 million. The dividends became payable to the shares outstanding, excluding the shares held directly by EXOR, on June 24, 2015, (ex-dividend trading date June 22) and were paid to the shares of record as of June 23, 2015 (record date).

The same shareholders’ meeting appointed the fifteen members of the Board of Directors of EXOR for the years from 2015 to 2017. Fourteen members were elected from the slate of candidates filed by the majority shareholder Giovanni Agnelli e C. and a director was elected from the slate filed by the group of thirteen investment management companies and institutional investors: Annemiek Fentener van Vlissingen (independent director), Andrea Agnelli, Vittorio Avogadro di Collobiano, Ginevra Elkann, John Elkann, Mina Gerowin (independent director), Jae Yong Lee (independent director), António Horta-Osório (independent director), Sergio Marchionne, Alessandro Nasi, Lupo Rattazzi, Robert Speyer (independent director), Michelangelo Volpi (independent director), Ruth Wertheimer (independent director), Giovanni Chiura (independent director).
The shareholders’ meeting also appointed the Board of Statutory Auditors composed of Enrico Maria Bignami (Chairperson), Sergio Duca and Nicoletta Paracchini (regular auditors), Ruggero Tabone e Anna Maria Fellegara (alternate auditors).

In addition, the shareholders’ meeting approved the Compensation Report pursuant to art. 123 – ter of Legislative Decree 58/98 and a new Incentive Plan which conforms to international best practice and has the purpose of aligning the compensation of the directors with the strategic objectives of the company. The plan allows the directors to choose to join the 2015 Incentive Plan as an alternative to the cash compensation established by the shareholders’ meeting. The Plan provides for free shares to be awarded for a total maximum number of 70,000 EXOR shares to the directors who decide to join the Plan, subject to the continuation of their appointment as company director up to the vesting date in 2018, concurrently with the date of the shareholders’ meeting that will approve the 2017 financial statements. The Plan will be serviced exclusively by treasury stock without the issue of new shares, and therefore, will have no dilutive effect. The information document relating to the Plan will be available to the public within the time frame established by law.

The shareholders’ meeting approved the renewal of the authorization for the purchase and disposition of treasury stock, also through subsidiaries. This authorization would allow for the purchase on the market, for the next 18 months, of EXOR shares for a maximum number of shares not to exceed the limit set by law, for a maximum disbursement of €500 million. Consequently the resolution passed for the purchase and disposition of treasury stock approved by the shareholders’ meeting on May 22, 2014, for the part not used, is revoked.

The Board of Directors’ Meeting of EXOR, held after the shareholders’ meeting, appointed John Elkann Chairman and Chief Executive Officer, confirmed the office of Vice Chairman to Alessandro Nasi and appointed Sergio Marchionne as new Vice Chairman.

Sale of the investment in Sequana

During the first half of 2015 EXOR S.A. sold the remaining 5,367,687 Sequana shares (10.85% of capital) on the market for a total equivalent amount of €18.7 million, realizing a net gain of €4.1 million.

Investment in PartnerRe

On April 14, 2015 EXOR submitted a proposal to the Board of Directors of PartnerRe (a company operating in the reinsurance market) to acquire 100% of the common shares of the company for $130 per share in cash, for a total of $6.4 billion.
EXOR’s proposal represented a premium to the implied value per share for PartnerRe under the amalgamation agreement between PartnerRe and another operator of the sector AXIS Capital Holdings Limited (AXIS) and thus provided PartnerRe shareholders with superior value and greater certainty since it was all in cash.

On May 4, 2015 the Board of Directors of PartnerRe rejected the proposal from EXOR and accepted the revised transaction proposed by AXIS after abandoning its original agreement, confirming its recommendation to the PartnerRe shareholders to vote in favor of the amalgamation with AXIS.

EXOR, having taken note of the decision by the Board of Directors of PartnerRe, expressed its determination to pursue its transaction and commenced with its advisors a campaign to gather proxies and to solicit shareholders to vote against the amalgamation of PartnerRe and AXIS.
In this context EXOR proposed improved (the most recent on July 20, 2015) terms to its Binding Offer making such proposal, in its own right already of superior value for the common and preferred shareholders of PartnerRe, even more attractive to them.

The definitive proposal by EXOR provides for an all-cash offer of $137.50 per share plus a special dividend of $3.00 per share, bringing EXOR’s total all-cash consideration to $140.50 per share to the common shareholders for a total of $6.9 billion, in addition to $0.70 per share of ordinary dividends per quarter through closing. EXOR offers enhanced terms to the preferred shareholders such as securities that are non-callable before January 2021 and with a higher dividend rate (+100 basis points) or the equivalent economic value through January 2021.

On August 3, 2015 EXOR announced it had signed the definitive merger agreement described above with the Board of Directors of PartnerRe, following the mutual decision of PartnerRe and AXIS Capital Holdings Limited to terminate their amalgamation agreement and cancel the special general meeting of PartnerRe planned for August 7, 2015.

The agreement includes a “go-shop” period during which the PartnerRe Board is entitled to solicit and evaluate any competing offers to the EXOR transaction and enter into negotiations related to proposals received prior to September 14, 2015, in each case subject to customary restrictions.
The transaction requires the approval of PartnerRe shareholders at a special general meeting to be called as soon as reasonably practicable. It is expected to close not later than the first quarter of 2016 subject to obtaining the necessary shareholder approval, receipt of regulatory clearance and customary closing conditions. If certain transaction approvals are not received within 12 months following signing or if there are certain non-appealable legal prohibitions to closing, EXOR has committed to pay PartnerRe $225 million as a partial reimbursement of the termination fee paid by PartnerRe to AXIS.

During the first half of 2015, EXOR has invested $609.3 million (€553.1 million) purchasing, also through its subsidiary EXOR S.A., 4,725,726 PartnerRe shares, becoming the largest shareholder with 9.9% of outstanding common shares.

Almacantar share capital increase

On June 5, 2015 Almacantar S.A. increased share capital for a total of £40 million in order to raise additional financial resources earmarked for new investments. EXOR S.A. subscribed to its share of the capital increase for a total equivalent amount of £15.3 million (€21 million) and paid in 50% of the amount equal to £7.3 million (€10 million). The remaining 50% of £7.3 million (€10.4 million) was paid in on July 17, 2015.
On July 17, 2015 Almacantar S.A. carried out a further capital increase of a total of £159.6 million. EXOR S.A. subscribed to its share for a total equivalent amount of £61.2 million (€87.6 million), paying in 50% of the amount equal to £29.1 million (€41.7 million).
After these transactions EXOR S.A. holds 38.30% of Almacantar’s capital and has a remaining liability for the subscribed shares not yet paid in of £29.1 million.

Sale of Allied World Assurance Company Holdings

During the first half of 2015 EXOR S.A. sold the entire investment held in Allied World Assurance Company Holdings (4.1% of capital) for a total equivalent amount of €153.7 million, realizing a net gain of €60.4 million.

Property investment in London

On July 1, 2015 EXOR S.A. signed preliminary contracts with Almacantar S.A. for real estate investments through the purchase of six property units situated in London for a total amount of £56.5 million. The property units will be restructured and placed at EXOR S.A. disposition starting from May 2017.

Agreement to increase the investment in The Economist Group

On August 12, 2015 EXOR agreed to purchase 6.3 million ordinary shares (or 27.8% of the class) for £227.5  million and 1.26 million B special shares (or 100% of the class) for £59.5 million in The Economist Group from the Pearson Group plc for a total of £287 million (€405 million).
Following this purchase, and a separate share buyback announced by The Economist of Pearson’s remaining ordinary shares in the Group, EXOR's shareholding in The Economist Group will increase from 4.7% to 43.4%.

It has also been agreed that, subject to a shareholder vote, The Economist's Articles of Association will be amended to limit to 20% the voting powers of any single shareholder, and to ensure that no one individual or company can own more than 50% of the Group’s shares. The editorial values of the newspaper will continue to be overseen by its independent Trustees.
The transaction is expected to close in the fourth quarter of 2015, subject to obtaining the necessary receipt of regulatory clearance, as well as the approval both on the part of the shareholders of The Economist with a 75% majority and on the part of its independent Trustees.

Commercial Register No.64236277 Legal notes | Credits