Significant events

Significant events in the first half of 2016 and subsequents events

Completion of the separation of Ferrari from FCA and subsequent listing on the stock exchange

The separation of the Ferrari business from the FCA Group was completed on January 3, 2016 through a partial proportional demerger from FCA, at the conclusion of which the FCA shareholders received one common share of Ferrari for every ten FCA common shares held while holders of FCA mandatory convertible securities received 0.77369 common shares of Ferrari for each MCS unit of $100 in notional amount. In addition, FCA shareholders participating in the company’s loyalty voting program received one special voting share of Ferrari for every ten special voting shares of FCA held.

EXOR, with its 375,803,870 FCA common shares held, received 37,580,387 Ferrari N.V. common shares and the same number of special voting shares, as well as another 6,854,893 common shares as holder of FCA mandatory convertible securities. At the closing of the transaction EXOR holds directly 22.91% of capital issued and 32.75% of voting rights on issued capital.

Ferrari common shares are traded on the New York Stock Exchange (NYSE) and starting January 4, 2016 also on the Mercato Telematico Azionario managed by Borsa Italiana (MTA).

Investment in Welltec

On February 10, 2016, with an investment of €103.3 million, EXOR acquired a 14.01% stake in Welltec, a global leader in the field of robotics technology for the oil and gas industry, from 7-Industries Lux S.à.r.l. (a company indirectly controlled by Ruth Wertheimer, independent director of EXOR).

Since this is a related party transaction prior approval was sought from the Related Parties Committee which expressed a favorable opinion on justified grounds, also taking into account a valuation carried out by an independent third party. After the acquisition EXOR and the 7-Industries Lux group each hold 14.01% of Welltec issued capital.

Sale of Banijay Holding to Zodiak Media

On February 23, 2016 EXOR S.A. finalized the sale of its entire investment in Banijay (17.1% of capital) within the context of a merger with Zodiak Media, a De Agostini Group TV production company. EXOR received proceeds on the sale of €60.1 million and realized a net gain €24.8 million.

Reorganization of FCA editorial holdings

With reference to the plan announced on March 2, 2016 by FCA for the creation of a major player in the publishing business and the desire to distribute its interests in the sector to its shareholders, EXOR on the same date communicated its intention to contribute actively and over the long-term to the development of the new publishing company that will result from the merger of ITEDI with Gruppo Editoriale l'Espresso. The objective of the transaction is to create the leading Italian daily and periodical news and media company that will also be one of the principal publishing groups in Europe.

As a part of the above plan, on May 1, 2016 the demerger of RCS to FCA shareholders became effective. At its conclusion EXOR received 25,459,208 RCS shares that were later sold on the market for a total of €17.3 million.

On August 1, 2016 Gruppo Editoriale l’Espresso S.p.A. (GELE) and Italiana Editrice S.p.A. (ITEDI) announced the signing of a framework agreement, which sets out the terms of the proposed integration between the two companies. The agreement was also signed by CIR S.p.A. (CIR), controlling shareholder of GELE, as well as FCA and Ital Press Holding S.p.A., controlled by the Perrone family, the shareholders of ITEDI. The combination will result in creation of the leading player in the Italian media and newspaper publishing sector and one of the leaders in Europe. Under the agreement, FCA and Ital Press will transfer 100% of their ITEDI shares to GELE in exchange for newly-issued reserved shares. Upon completion of the transaction, CIR will hold a 43.4% ownership interest in GELE, with FCA holding 14.63% and Ital Press 4.37%. As soon as practicable following completion, FCA will distribute its entire interest in GELE to holders of FCA common stock. That distribution will result in EXOR acquiring a 4.26% interest in GELE. In conjunction with the merger agreement, CIR also entered into two shareholder agreements with deferred effect with FCA and Ital Press relative to their respective future shareholdings in GELE. In addition to CIR’s undertaking to vote for the proposed transaction at the GELE shareholder meeting, to be convened at the proper time, the parties also undertake, with effect from the completion date of the merger, to appoint John Elkann and Carlo Perrone to the GELE board of directors, and grant CIR the right to appoint the Chairman and Chief Executive Officer.

FCA also undertakes, for the duration of the shareholder agreement, not to transfer its shares in GELE that are subject to the terms of the agreement. The agreement between CIR and FCA will expire upon distribution by FCA of its shares in GELE to holders of FCA common stock. Concurrent with the expiry of the CIR-FCA shareholder agreement, a new shareholder agreement will take effect between CIR and EXOR. The terms of that agreement include obligations of mutual consultation in advance of any GELE shareholder meeting, undertakings from CIR relating to the appointment and permanence to GELE’s board of directors of a representative designated by EXOR, undertakings from EXOR to present and vote for a single voting list jointly with CIR for elections to GELE’s board of directors and an undertaking from EXOR, for the duration of the agreement, not to transfer the shares subject to the terms of the agreement (with the exception of transfers to other members of the EXOR group).

Both the CIR-EXOR and CIR-Ital Press shareholder agreements will remain in force for a period of three years.

Completion of the transaction is expected during the first quarter of 2017.

Completion of the transaction for the acquisition of PartnerRe

The acquisition of PartnerRe was completed on March 18, 2016 after having received all necessary approvals. The total payment made by EXOR at the closing was $6,108 million (€5,415 million) of which $6,065 million (€5,377 million) was paid to common shareholders and $43 million (€38 million) to preferred shareholders, as immediate economic value in lieu of the higher dividend rate. The treasury stock held by PartnerRe and the common shares held by EXOR S.p.A. and EXOR S.A. were cancelled without consideration, while those held by third parties received the consideration agreed in the merger agreement. As of the closing date EXOR indirectly became, through EXOR N.V., owner of 100% of the common shares of PartnerRe.

The common shares were delisted from the New York Stock Exchange (NYSE) as of the same date. The acquisition did not include the preferred shares issued by PartnerRe, which continue to be traded on the New York Stock Exchange.

Sale of Almacantar and investment funds to PartnerRe

On March 24, 2016 EXOR S.A. reached an agreement to sell its investment in Almacantar (approximately 36% of share capital) to Partner Reinsurance Company Ltd., a 100%-owned subsidiary of PartnerRe. The transaction was completed on April 8, 2016 with the receipt of £382.7 million (€474.7 million).

In April 2016 EXOR S.A. also sold a number of its financial investments to the PartnerRe Group, mainly third party funds, for approximately $195 million (€171 million).

The transactions were concluded at market prices and aimed at increasing the diversification of investments held by PartnerRe by introducing real estate as a new asset class, without changing the overall risk profile of its portfolio. EXOR used the entire proceeds from these transactions to reduce its debt.

Increase in EXOR bonds due December 2025

On May 10, 2016 EXOR reopened the €250 million bonds issued on December 22, 2015, increasing the amount by €200 million. Like the bonds previously issued, the new bonds carry an annual fixed coupon of 2.875% and are due in December 2025. The new bonds issued through a private placement to institutional investors yield 2.51% and are listed on the Luxembourg Stock Exchange.

Issue of EXOR non-convertible notes due May 2026

On May 20, 2016 EXOR issued its first U.S. dollar non-convertible notes for $170 million (issue price of 100% of the nominal value) due May 20, 2026, for the purpose of refinancing its short-term debt. The new notes were issued through a private placement to institutional investors and pay interest semi-annually at an annual rate of 4.398%. The notes, rated BBB+ by Standard & Poor’s, are listed on the Luxembourg Stock Exchange.

Resolutions by the shareholders’ meeting of May 25, 2016

The shareholders’ meeting of May 25, 2016 approved the payment of dividends per share of €0.35 for a total maximum amount of €82 million. The dividends became payable on June 22, 2016 (ex dividend date June 20) and were paid to shareholders of record as of June 21, 2016 (record date). The dividends were paid to the shares outstanding, thus excluding the shares held directly by EXOR.

The shareholders’ meeting approved the Compensation Report pursuant to art. 123-ter of Legislative Decree 58/98 and a new Incentive Plan pursuant to art. 114-bis of the same Legislative Decree.

The objective of the new Incentive Plan, denominated Long Term Stock Option Plan 2016, is to increase the motivation and loyalty of employees who hold important positions in EXOR, envisaging also a component of motivation and loyalty based on long term goals, in line with strategic objectives.

Il nuovo piano d’incentivazione, denominato Long Term Stock Option Plan 2016, basato su strumenti finanziari, ha l’obiettivo di incrementare la capacità di incentivazione e di fidelizzazione delle risorse che ricoprono un ruolo significativo in EXOR, prevedendo anche una componente di incentivazione e fidelizzazione basata su obiettivi di lungo periodo, in linea con gli obiettivi strategici.

Il piano prevede l’assegnazione di massime 3.500.000 opzioni, che consentono ai destinatari di acquistare un corrispondente numero di azioni ordinarie di EXOR secondo i termini prestabiliti.

Le opzioni assegnate matureranno il 30 maggio di ogni anno, a partire dal 2017 e per i cinque anni successivi. Le opzioni potranno essere esercitate a partire dal terzo anno dalla data di maturazione, fino al 31 dicembre 2026.

The Plan provides for awarding a maximum of 3,500,000 options that will allow the recipients to purchase a corresponding number of EXOR ordinary shares according to the established time frame.

The options vest on May 30 of each year beginning in 2017 and for the following five years. The options can be exercised starting from the third year of the vesting date, up to December 31, 2026. The Plan will be serviced exclusively by treasury stock without any new share issues and therefore will not have any dilutive effect.

A resolution was also passed for the renewal of the authorization for the purchase and disposition of EXOR treasury stock, also through subsidiaries. The shares may be purchased on the market for 18 months from the date of the shareholders’ resolution 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 29, 2015, which in any case was not used, is revoked.

The shareholders’ meeting in special session also approved the cancellation of 5,229,850 shares of treasury stock in portfolio, net of those to service the incentive plans. The shares were cancelled without reducing share capital but by eliminating the par value of the shares with a consequent change in article 5 of the by-laws. The elimination of the share par value has made it possible to simplify the manner of carrying out future transactions regarding share capital and shares. Following approval the bylaws only indicate share capital and the number of ordinary shares which form share capital.

Change in the composition of EXOR share capital

On June 9, 2016 EXOR filed the resolution of the extraordinary session of the shareholders’ meeting held on May 25, 2016 for registration in the Turin Company Register relating to the cancellation of 5,229,850 shares of treasury stock, without reducing share capital. As of today’s date share capital amounts to €246,229,850 and consists of 241,000,000 ordinary shares.

Approval of the cross-border merger plan to create the holding company Exor Holding N.V.

On July 25, 2016, in order to simplify the corporate structure to better reflect the ever more global profile of the company and its businesses, the EXOR board of directors approved the proposed cross-border merger of EXOR with and into Exor Holding N.V. a wholly-owned Dutch subsidiary of EXOR in which Exor Holding N.V. will survive as the new parent company.

As a result of the merger each EXOR shareholder will receive one Exor Holding N.V. ordinary share that grants one voting right for each EXOR share held. Exor Holding N.V. ordinary shares will be listed solely on the Mercato Telematico Azionario managed and organized by Borsa Italiana. Exor Holding N.V. will adopt a loyalty voting structure designed to incentivize long-term share ownership, on the basis of which for each Exor Holding N.V. ordinary share held without interruption for a period of five years, shareholders will be entitled to five voting rights at the end of that period, and for each Exor Holding N.V. ordinary share held without interruption for a period of ten years, shareholders will be entitled to ten voting rights at the end of that period. The transaction is conditional, among other things, on the amount payable by EXOR to (a) those shareholders’ exercising their withdrawal rights and (b) creditors of EXOR exercising their creditor opposition rights, not exceeding €400 million in aggregate value.

EXOR’s controlling shareholder, Giovanni Agnelli e C. and a certain number of long-term oriented entrepreneurs and institutions, have committed to acquire EXOR shares available from the exercise of the right of withdrawal and that may not have been purchased by shareholders or third parties in the offer and sale process provided for under Italian law. Specifically, Giovanni Agnelli e C. has confirmed its full support for the transaction and has committed to acquire residual withdrawn shares up to an aggregate amount of €100 million (calculated on the basis of the withdrawal price) and, should the aggregate value of the residual withdrawn shares exceed €100 million, the other investors, severally and not jointly, will acquire the remaining amount of residual withdrawn shares prorata based on their commitments, up to the aggregate amount of €300 million.

The price payable to shareholders exercising their withdrawal rights is EUR 31.2348 for each share.

The transaction does not have an impact on EXOR’s controlled companies, whose industrial and fiscal commitments remain unchanged in each jurisdiction in which they operate.

EXOR’s shareholders’ meeting for the approval of the Merger Plan is fixed for September 3, 2016.

The Merger is expected to become effective by the end of 2016, subject to the satisfaction or waiver of the conditions precedent.

All documents concerning the Merger, including the Common Cross Border Merger Plan, the Board Reports, the Information Document and the proposal of resolution, will be made available to the public within the terms of law.

Sale of Arenella Immobiliare

On July 30, 2016 EXOR concluded the sale of its entire investment in Arenella Immobiliare. Proceeds totaled €22 million.

Commercial Register No.64236277 Legal notes | Credits