(Bloomberg) -- PartnerRe Ltd.’s former Chief Executive OfficerPatrick Thiele said the reinsurer’s shareholders should voteagainst a planned merger with Axis Capital Holdings Ltd. and calledthe cash offer from Italy’s Exor SpA a better option.

A combination with Axis would be “high risk with limited or noincrease in return,” Thiele, who stepped down as CEO in 2010, saidby e-mail. He said he expects more value generated with Exor, theinvestment firm of the billionaire Agnelli family.

After an Axis merger, the company would “fire a lot of peopleand reduce expenses, which you always have to weigh against whatyou’re losing in premium that’s associated with those people,”Thiele said Wednesday in an interview at Bloomberg headquarters inNew York. PartnerRe was “already more efficient in terms of theircapital use than Axis. So what’s the point of putting themtogether?”

PartnerRe has scheduled a shareholder vote on the Axis proposalon July 24. The companies said in a Jan. 25 statement announcingthe deal that they expected $200 million in cost savings in thefirst 18 months after the merger. Both boards have approved thecombination.

Exor, which is offering $6.8 billion in cash to acquire theBermuda-based reinsurer, has said taking PartnerRe private can helpit weather market volatility as prices are pressured by competitionand a lull in catastrophes. Exor Chairman John Elkann pledged tocontinue the company’s existing strategy and maintainleadership.

Axis, PartnerRe and Exor have been meeting with investors,issuing statements and filing presentations to woo shareholdersahead of the vote.

'Longstanding relationship'

“Mr. Thiele’s comments will probably carry some (deserved, inour view) weight with investors, not least because of hislongstanding relationship with Axis CEO Albert Benchimol,” MeyerShields, an analyst at Keefe, Bruyette & Woods Inc., said in anote to clients Thursday.

Benchimol, who previously worked at PartnerRe with Thiele aschief financial officer, said a merger would create the world’sfifth-largest property-casualty reinsurer. It could helpBermuda-based Axis compete with larger rivals like Warren Buffett’sBerkshire Hathaway Inc., Munich Re and Swiss Re AG.

Thiele contacted PartnerRe in late January about taking a rolein the planned Axis integration and serving on the board of thecombined company, and was later rebuffed, e-mails show. He said itcould be difficult to combine two demoralized organizations andsought a bonus with a target of $2 million, according to thecorrespondence.

Approaching Elkann

Then, as Exor approached PartnerRe, Thiele reached out to Elkannand offered to help in an unpaid advisory role. Exor has an opendialogue with Thiele, and he isn’t getting any financialcompensation, said a spokesman for the Turin-based company.PartnerRe confirmed the authenticity of the e-mailcorrespondence.

Thiele said in the interview that adding primary insuranceoperations through Axis would put it in competition with clients.He said he’s arguing against the merger, in part, because employeesof his former firm “deserve better.”

The former CEO built PartnerRe in the decade through 2010 bykeeping a focus on reinsurance and completing an almost $2 billiontakeover of Paris Re. Reinsurers provide backup coverage to primaryinsurers. The firm was an early backer in mortgage guarantor EssentGroup Ltd. with Goldman Sachs Group Inc. and JPMorgan Chase &Co.

PartnerRe Chairman Jean-Paul L. Montupet has rejected Exor’soffer as unacceptable and reiterated his support for Axis in ane-mailed statement after Thiele’s remarks.

The planned merger “will provide the best value for allshareholders and the opportunity to participate in the upsidegenerated from substantial synergies in a more diversified companywith market-leading profitability, greater marketplace relevanceand an even stronger capital structure,” Montupet said.

--With assistance from Tommaso Ebhardt in Milan.

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