1 Claude Bebear, chairman and chief executive officer, of Axa-Midi Assurances, pledged to retain employees and management of Farmers Group Inc., including Leo E. Denlea Jr., chairman and chief executive officer, if Axa succeeds in acquiring Farmers.
2 Mr. Bebear added that the French insurer would keep Farmers' headquarters in Los Angeles and 'will not send French people to run the company.' Axa would also maintain Farmers' relationships with the insurance exchanges that it manages.
3 Mr. Bebear made his remarks at a breakfast meeting with reporters here yesterday as part of a tour in which he is trying to rally support in the U.S. for the proposed acquisition.
4 The bid is part of Sir James Goldsmith's unfriendly takeover attempt for B.A.T Industries PLC, the British tobacco, retailing, paper and financial-services giant that acquired Farmers last year for $5.2 billion.
5 Axa has agreed to acquire Farmers from Sir James's investment vehicle, Hoylake Investments Ltd., for $4.5 billion plus a $1 billion investment in Hoylake.
6 Any acquisition of Farmers needs the approval of insurance commissioners in the nine states where Farmers operates, and Mr. Bebear's trip will take him to Idaho, Arizona and New York after his stay here; he will meet with insurance regulators, legislators, industry excutives and the press.
7 Hearings on Axa's acquisition application have been set for Nov. 13 in Idaho; Nov. 20 in Illinois; Nov. 24 and Dec. 4 in Arizona; Dec. 11 in Washington state; and Jan. 8 in Oregon.
8 Hearings haven't yet been set in Texas, Ohio and Kansas.
9 California's insurance commissioner doesn't hold hearings on acquisition applications.
10 Although Axa has been rebuffed by Farmers and hasn't had any meetings with management, Mr. Bebear nonetheless appears to be trying to woo the company's executives with promises of autonomy and new-found authority under Axa.
11 He said Mr. Denlea would be a member of the top management team of the Axa-Midi group of companies, and would 'help define policies and strategies of the group.'
12 Farmers was quick yesterday to point out the many negative aspects it sees in having Axa as its parent.
13 For one, Axa plans to do away with certain tax credits that have resulted in more than $600 million paid to the Farmers exchanges during the past few years to offset underwriting losses.
14 Those credits result because of taxes that Farmers, as the management company, has paid, and have 'proved to be very important for the exchanges,' a Farmers spokesman said.
15 Mr. Bebear contended that the tax cost to the exchanges under the revised structure would be about $8 million a year, which he described as 'peanuts.'

Mr . Bebear added that the French insurer would keep Farmers ' headquarters in Los Angeles and " will not send French people to run the company . " Axa would also maintain Farmers ' relationships with the insurance exchanges that it manages .
French insurer
What does Axa-Midi Assurances insure?