ReAssure Taking Over Legal & General Insurance Based Savings - Stick with it or cash out early?

I’ve never heard of ReAssure to be honest.

Have you heard of most of the best retail financial services companies? The average consumer hasn't.

I have an endowment policy that is underperforming, as most seem to be,

Most are not underperforming. That was never the issue with endowments.

Any opinions as to how good ReAssure are performance wise, compared to L&G,

It will be no different for many years.

Like the OP and most of us mere mortals I never heard of any of these three companies!

Three?
L&G - well known brand in the UK but no longer that interested in the individual life and pensions market and like many insurers before it, it is looking to offload its legacy book.
Reassure - large company but not a common name as it didnt have much in the way of retail products that consumers would buy. Typically you ended up with Reassure through your company being bought rather than buy a reassure product. They have bought many big names insurance books (Barclays, HSBC amongst others).
Phoenix - possibly the biggest and most well known of the companies that buys old insurance company books. They started out by buying Pearl Assurance and have never looked back buying very many legacy name books. Sometimes Phoenix effectively take over the office and computers of the firm it is buying and continues to run them as they were. Sometimes it will look to move the plans on to other software where it is possible to do so. A lot of the time, the old Pearl Assurance layout is used on letters which makes you think that their software is being used with some of the other providers that have been bought.

In spite of that I don't like the smell of this deal, though of course I don't know enough to judge it (and would rather not have to if I'm honest!).

I think it is good news. Phoenix do a very good job. As they tend to buy the unwanted parts of insurers, many of which have been starved of funding for years or even decades, they often improve the quality after a period (not overnight as they have to assess what they have and how it works).

Would you rather be with a company that doesnt want you or one that does?

I have read though that one of the reasons that Swiss Re are getting rid of ReAssure is that it will improve their results in the Swiss stress test of financial institutions, which does not exactly increase confidence!

None of that has anything to do with Phoenix which will be the ultimate owner. Phoenix and Swiss Re operate mostly in different areas.

The whole chain sounds a bit like sorting out the rotten apples and putting them in one basket.

Not rotten but unwanted.

Legacy books are often on old computers and software that needs updating. The profit to be made on UK legacy books is not large and many of the big companies believe that they can make bigger profits from the capital from the sale rather than remaining in the market. This is why not just the old small insurers have sold up but the big ones have been doing it as well. If you look at the list of company books Phoenix has bought, it will read almost like a directory of yesteryear insurers.

reminiscent of subprime..

No. Nothing like subprime.

A lot of the legacy plans are obsolete by modern plan standards and should be reviewed. Although not everything old is bad. There are some gems worth keeping. This is little you can do with endowments but pensions and investments may well be improved with modern options and worth investigating.