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Wednesday, August 5, 2015

Recent Sell: PartnerRe Ltd

Aug 4, 2015: Sold 27 shares of PRE at $139.03 per share.

Yesterday I sold all my shares of Partnerre Ltd (NYSE:PRE), a company that provides reinsurance services around the world.

PRE recently agreed to be acquired by Italy's Exor SpA (OTCPK:EXOSF) in a deal worth $6.9 billion (or $140.50 per share). The agreement brings to an end the takeover drama for the Pembroke, Bermuda-based company and dashes the hopes of a merger with Axis Capital Holdings Ltd (NYSE:AXS). AXS will receive a $315 million termination fee from PRE.

One of my rejection criteria at DivGro is if a company is to be acquired by (or will be merged with) another company. Whereas I consider this criterion a reason not to buy, I don't see it as a straightforward reason to sell.

Compared with a merger with AXS, to me, the acquisition by EXOSF is unattractive. Many foreign companies do not pay quarterly dividends or subscribe to a strong dividend growth philosophy. I could not find a track record of dividend payments on EXOSF's website.

With PRE trading around $139, I feel it is close enough to the $140.50 being offered by EXOSF. The details of the agreement stipulates that EXOSF will pay $137.50 per share in cash plus a $3.00 per share special dividend. The agreement includes a so-called go-shop period in which PRE can solicit and evaluate any competing offers until 14 September 2015. Some investors may want to hold out for a better offer, but I've decided to move on.

I bought 27 shares of PRE in May 2013 at $91.80 per share and at an initial YoC (yield on cost) of 2.79%. Since then, PRE increased its quarterly dividend twice, by 3¢ per share in January 2014 and again by 3¢ per share in February 2015. These increases raised YoC to 3.05%.

Trading Summary

 Buy: 27 shares of PRE at $91.69 per share:
  Sold 27 shares of PRE at $139.03 per share:
Capital gain:

Dividends received:


Net gain:

The net gain is 57.98% on the original amount invested, or 26% annualized. I couldn't be happier with this performance, but it is time to move on!

27 shares of PRE represent $75.60 of expected annual dividend income, which reduces DivGro's projected annual dividend income to $6,599.46.

If you own PRE, are you planning to hold onto your shares or sell them? Thanks for reading/commenting!


  1. Hey DivGro,

    Never heard of this company, but this gain is pretty good!
    I'd sign up for that gain every 2 years :)

    Good luck in redeploying this money!

    Best wishes, DfS

    1. Thanks, DfS -- certainly, 26% is a great return...

      I have some ideas about redeploying this money, but I'm waiting until I've done my monthly 10 best stocks analysis.

      Take care!~

  2. HI DivGro
    I so glad to see you so prosperest on this stock. Keep up the good work


    1. Thanks, Michael. An annualized rate of 26% is great. I'll take that anytime! It would allow one to double your money every 33 months!

  3. FerdiS, great profit and reason to sell. Cant wait to see what you buy. Payday is coming up for me, that means I will be buying. Contenders I am looking at adding to existing positions PG, EMR, COP, BP & HCP. Positions I am considering starting are AAPL & STAG. Happy investing!

    1. Thanks, Mike. I have two other "recent sells" on the way... look out for those articles coming soon. And I've already bought AAPL and STAG myself (great minds think alike?). I just haven't had enough time to write posts about them...


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