BREAKING NEWS

RenaissanceRe will acquire Tokio Marine’s reinsurance platform for $1.5 billion

RenaissanceRe Holdings Ltd. (NYSE:RNR) (“RenaissanceRe” or the “Company”) announced today that it has entered into a definitive agreement with Tokio Marine Holdings, Inc. (“Tokio Marine”) pursuant to which an affiliate of RenaissanceRe will acquire Tokio Marine’s reinsurance platform, which includes Tokio Millennium Re AG and Tokio Millennium Re (UK) Limited (collectively, “TMR”). Under the terms of the transaction, Tokio Marine will receive 1.02x the tangible book value of TMR delivered to RenaissanceRe at closing. If closing tangible book value is unchanged from June 30, 2018, Tokio Marine would receive approximately $1.5 billion in total consideration, consisting of cash and RenaissanceRe common shares.
RenaissanceRe expects that upon closing the transaction will be immediately accretive to book value per share, tangible book value per share, operating earnings per share and operating return on equity.

The agreement has been unanimously approved by the Boards of Directors of both companies. The transaction is expected to close in the first half of 2019 and is subject to customary closing conditions and regulatory approvals. No shareholder approval is required.

Under the terms of the agreement, if closing tangible book value is unchanged from June 30, 2018, the transaction consideration would consist of approximately $1.22 billion of cash and $250 million of RenaissanceRe common shares. The shares received by Tokio Marine will be valued at today’s closing price of $128.37 per common share, subject to adjustment at closing and a one-year holding period commencing at closing. The cash consideration will be funded through RenaissanceRe available funds and a potential pre-closing dividend from TMR, subject to regulatory approval.

In connection with the transaction, Tokio Marine has agreed to provide RenaissanceRe a $500 million adverse development cover that will protect TMR’s stated reserves at closing, including unearned premium reserves. In addition, Tokio Marine and RenaissanceRe will enter a business cooperation agreement, which will enhance their business relationship and facilitate cooperation on a portion of the international reinsurance purchases of Tokio Marine and its affiliates.

In addition, State Farm Mutual Automobile Insurance Company (“State Farm”) has agreed to invest $250 million in RenaissanceRe through its purchase of RenaissanceRe’s common shares in a private placement, following termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The shares purchased by State Farm will be valued at today’s closing price of $128.37 per common share. Following the completion of its investment, State Farm will own approximately 4.8% of RenaissanceRe’s total common shares outstanding, reflecting a broader relationship with RenaissanceRe that includes State Farm’s investments in RenaissanceRe-managed vehicles Top Layer Reinsurance Ltd. and DaVinciRe Holdings Ltd.

Kevin O’Donnell, President and CEO of RenaissanceRe commented: “We are very pleased to have entered into a definitive agreement to acquire Tokio Millennium Re from Tokio Marine. This transaction will increase our scale, broaden our reach and extend our ability to apply our core strengths to a deeper customer base. Our unique ability to capitalize on large, one-of-a-kind opportunities underscores our global reinsurance leadership, including in Casualty and Specialty lines, and our ability to execute on our successful, highly differentiated strategy.”

Mr. O’Donnell added: “We are also honored that State Farm has agreed to broaden its relationship with RenaissanceRe by investing in our common shares and extending a long-standing partnership between our two firms. Our acquisition of TMR and State Farm’s investment further enhance the relationship between our respective companies, which I am confident will prove equally beneficial to our shareholders. After these transactions close, we anticipate that we will continue to have the very strong capital and liquidity position you have come to expect from RenaissanceRe.”

State Farm Executive Vice President, Paul Smith, offered, “We see this as an opportunity to strengthen the long term relationship we have with RenaissanceRe.”

BofA Merrill Lynch is acting as financial advisor to RenaissanceRe in connection with the transaction and Willkie Farr & Gallagher LLP as legal counsel. Wachtell, Lipton, Rosen & Katz is acting as legal counsel to RenaissanceRe’s Board of Directors in connection with the transaction.
Conference Call and Webcast:

RenaissanceRe will discuss this transaction as part of its regularly scheduled investment community conference call on Wednesday, October 31, 2018, at 10:00 a.m. ET. In addition, interested persons may access a slide presentation regarding the transaction, which will be available from approximately 7:00 a.m. ET on October 31, 2018, and a live webcast of the conference call via the Investors section of RenaissanceRe's website at www.renre.com. An archive of the call will be available from approximately 2:00 p.m. ET on October 31, 2018through midnight ET on January 9, 2019.

About RenaissanceRe
RenaissanceRe is a global provider of reinsurance and insurance that specializes in matching well-structured risks with efficient sources of capital. The Company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, the Company has offices in Bermuda, Ireland, Singapore, Switzerland, the United Kingdom, and the United States.

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