-- Hannover Re to concentrate on its core business going forward -- QBE acquires 100% of Praetorian for US$800 million
HANNOVER, Germany, Dec. 13, 2006 (PRIME NEWSWIRE) -- Hannover Re today reached agreement to sell its U.S. subsidiary Praetorian Financial Group, Inc., New York, to QBE Insurance Group Ltd., Sydney, Australia. "This successful sale demonstrates that it was the right decision to carve out our U.S. primary specialty business into Praetorian," Chief Executive Officer Wilhelm Zeller explained. Once this transaction is completed Hannover Re will concentrate exclusively on its core business of reinsurance. "We have no doubt," Mr. Zeller continued, "that with QBE -- a leading Australian and international primary insurance group -- a strong strategic partner has been found for Praetorian."
QBE is to acquire 100% of the share capital of Praetorian. The purchase price of US$800 million represents 2.1 times Praetorian's estimated tangible book value at year-end 2006.
"Over the past year, Praetorian has made significant strides in strengthening and refining the company's operational capabilities," Rod Fox, CEO of Praetorian Financial Group, said. "The combination with QBE the Americas will build on those successes while allowing us to offer a broader range of products and maintain continuity in client relationships. We are excited by the opportunities 2007 presents and look forward to joining the very talented QBE family."
The transaction, which is subject to regulatory approval, is expected to close in the second quarter of 2007.
Hannover Re intends to redeploy the capital freed up by this transaction to its core property/casualty and life/health reinsurance businesses.
Hannover Re, with a gross premium of approximately EUR 10 billion, is one of the leading reinsurance groups in the world. It transacts all lines of property/casualty, life/health and financial reinsurance as well as specialty insurance. It maintains business relations with more than 5,000 insurance companies in about 150 countries. Its worldwide network consists of more than 100 subsidiaries, branch and representative offices in around 20 countries with a total staff of roughly 2,000. The rating agencies most relevant to the insurance industry have awarded Hannover Re very strong insurer financial strength ratings (Standard & Poor's AA- "Very Strong" and A.M. Best A "Excellent").
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