By Eric Sylvers and Ben Dummett 

The coronavirus pandemic sank its second-biggest corporate deal of the year -- the proposed $9 billion sale of a reinsurance business by Exor NV, the holding company of Italy's Agnelli family, which also controls Fiat Chrysler Automobiles NV.

French insurer Covéa Coopérations agreed to buy the reinsurer, PartnerRe, from Exor in early March. When the two sides announced the deal, the coronavirus was just beginning to spread in Europe.

Several other companies have rethought big deals in recent weeks, in some cases retrenching and seeking to protect liquidity during the severe economic crisis precipitated by the pandemic. Xerox Holdings Corp. abandoned its more than $30 billion bid to buy larger rival HP Inc.

L Brands Inc. and Sycamore Partners scrapped their plans to take Victoria's Secret private, dropping a deal reached just weeks before the coronavirus pandemic forced the lingerie retailer to temporarily shut its stores.

On Tuesday, Exor said Covéa had tried to renegotiate the terms of the deal and then backed out. The holding company said the deal's memorandum of understanding didn't have a clause allowing the agreement to be shelved in the case of a pandemic.

Covéa said in a statement: "In light of the current unprecedented conditions and significant uncertainties threatening the global economic outlook, Covéa has indicated to Exor that the context does not allow the contemplated acquisition of PartnerRe to be carried out on the terms initially envisaged." A Covea spokeswoman couldn't immediately be reached for comment.

John Elkann, the Agnelli scion who is chairman and chief executive of Exor, hadn't been looking to sell PartnerRe, but agreed because he said a favorable price had been offered. Exor, which owns 29% of Fiat Chrysler, agreed to buy PartnerRe in 2015 for $6.9 billion. It was the holding company's largest acquisition in its multiyear diversification away from its reliance on the automobile industry.

The deal's collapse comes as fallout from the pandemic has highlighted the increasing risks Exor faces in its bigger bet to create an auto giant through the planned merger of Fiat Chrysler and Peugeot maker PSA Group. Both sides said as recently as last week that they remain committed to the tie-up, but some analysts and investors are less certain about the math behind the deal.

The current terms call for the Italian-American car maker to make a EUR5.5 billion, or about $6 billion, cash payout to Fiat Chrysler shareholders at a time when Fiat and other car makers have scrambled to save and raise cash. ((link:

SoftBank Group Corp. moved in March to back out of a deal to buy $3 billion worth of shares in WeWork's parent company from investors and former and current employees. The Japanese conglomerate cited various reasons including regulatory probes, though not the virus. A special board committee at the shared-office-space company sued SoftBank for breach of contract in April, and the two sides are set to face off in trial early next year.

Late last month, Boeing Co. said it had dropped plans to take control of the jetliner business of Brazil's Embraer SA, saving around $4 billion in much-needed cash. Boeing said the companies failed to agree to final terms by the initial termination date and opted to walk away from the two's planned joint ventures, announced in 2018.

Write to Eric Sylvers at and Ben Dummett at


(END) Dow Jones Newswires

May 12, 2020 16:38 ET (20:38 GMT)

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