(Bloomberg) — Exor SpA offered $6.4 billion for PartnerRe Ltd.,seeking to break up the reinsurer's planned merger with AxisCapital Holdings Ltd.

Exor, controlled by the Agnelli family, is offering $130 a sharein cash, the company said in a statement Tuesday, or 16% above theimplied value per share of Bermuda-based PartnerRe under the termsof the Axis agreement.

An Axis-PartnerRe combination would create the world'sfifth-biggest property-and-casualty reinsurer, and was announced in January, the same month that XL Group Plc agreed to buy Catlin Group Ltd. for about $4billion. Exor, the biggest investor in automaker Fiat ChryslerAutomobiles NV, has been seeking opportunities in the financeindustry after selling its stake in Geneva-based SGS for 2 billioneuros ($2.1 billion) in 2013, generating a capital gain of 1.53billion euros.

"Our proposal provides superior value for PartnerRe shareholderswith the certainty of a cash offer," John Elkann, Exor chairman andchief executive officer, said in a statement. "It also represents agreat opportunity for the company's management and employees tocontinue to develop PartnerRe's outstanding potential as a leadingglobal reinsurer with our committed and stable ownership."

PartnerRe jumped 8.8% to $129.65 at 1:49 p.m. in New Yorktrading. That company closed at $119.14 Monday and $114.14 on thelast trading day before the Axis agreement was announced.

Axis, also based in Bermuda, was little changed. Exor rose 0.4%at the close of trading in Milan, before the bid was announced.

Bridge Loan

Exor said it can pay with cash on hand and funds from a bridgefacility and term loan from Citigroup Inc. and Morgan Stanley foras much as $4.75 billion. The Turin, Italy-based company said ithas invested in insurance for more than two decades, including inPartnerRe's formation in 1993. Axis's Linda Ventresca and DrewBrown, a spokesman for PartnerRe at Sard Verbinnen & Co.,didn't immediately return calls seeking comment.

"We do not believe it would be wise for Axis to engage in abidding war," MKM Partners analysts led by Harry Fong said in anote to investors. "We place a high probability that PartnerRe'sshareholders will vote in favor of selling to Exor." Axis would beentitled to a $250 million breakup fee if PartnerRe opted to gowith Exor, they wrote.

Reinsurers take on some of the largest risks from primarycarriers and can offer specialized coverage to commercial clientsin industries such as energy and aviation. Their margins have beenpressured in recent years by pension funds and Wall Streetinvestors seeking to take on insurance risks, including those tiedto the weather, that aren't correlated with financial markets.

'Sound Argument'

Axis and PartnerRe said when they announced their deal that itwould create a company with a market value of about $11 billionthat would be able to offer more to clients and benefit fromeconomies of scale. Analysts including Josh Shanker at DeutscheBank AG and Charles Sebaski at BMO Capital Markets questionedwhether the Axis agreement was favorable for PartnerRe.

PartnerRe investors "have a sound argument that the current dealterms do not maximize shareholder value," Sebaski said in an April8 note. The company's CEO, Costas Miranthis, stepped down when thedeal was announced, and Axis's Albert A. Benchimol was chosen tolead the combined reinsurer.

Exor said it is best able to build PartnerRe by "focusing on itslong-term prospects, better managing the volatility of thereinsurance cycle and proactively seizing marketopportunities."

Exor said its bankers on the deal were Byron Trott's BDT &Co., Citigroup and Morgan Stanley. Its legal advisers are Paul,Weiss, Rifkind, Wharton & Garrison; Cox Hallett Wilkinson; andPedersoli e Associati.

–With assistance from Noah Buhayar in Seattle and ZacharyTracer and Matthew Monks in New York.