Birth of global giant with merger of Axis Capital Holdings and PartnerRe Ltd

The $11 billion merger of Axis Capital Holdings Ltd and PartnerRe Ltd will create one of the world's largest reinsurers. It will also have a significant Irish dimension to it as both companies have subsidiaries based here.

PartnerRe's Irish subsidiary, PartnerRe Holdings Europe, owns holding companies for all or part of the group's business in Switzerland, France, the US, the Netherlands and Ireland. Its subsidiary, Partner Reinsurance Europe SE, had gross written premiums of €2.4 billion in 2013, getting on for half the Partner Re group's gross premiums.

Axis's Irish operations are equally chunky. Axis Speciality Europe had assets of $1.69 billion and gross premiums of $556 million in 2013. Another Irish subsidiary, Axis Re SE, had gross written premiums of $1.144 billion and Axis Speciality Holding s Ireland had gross written premiums of $1. 7 billion.

Combined group

Based on these figures, the Irish operation of the combined group will accounts for about $6 billion of the gross written premiums of “above $10 billion” that have been projected for the combined group.

The new unnamed firm looks like a prime candidate to follow its rival XL re and relocate lock, stock and barrel to Ireland from Bermuda for tax reasons.

Given the Irish-based companies employ 1,000 of the projected combined workforce of 2,000, any such move should pass muster under the stringent substantive operation tests to be applied to such ventures if Europe gets its way.