NEW YORK, May 3, 2006 (PRIMEZONE) -- Murray, Frank & Sailer LLP has filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all who purchased the securities of PXRE Group Ltd. (NYSE:PXT) ("PXRE" or the "Company") between July 28, 2005 and February 16, 2006, inclusive (the "Class Period"). The Complaint alleges violations of both the Securities Exchange Act of 1934 and the Securities Act of 1933.
PXRE is a world-wide provider of catastrophe reinsurance products and services to both primary insurers and reinsurers. Since 1987, it has specialized in offering catastrophe and risk excess reinsurance.
The Complaint alleges that defendants' issued a series of false and misleading statements to the market artificially inflating the Company's stock. More specifically, the Defendants failed to disclose the following materially adverse facts to the market: (1) that the Company concealed from investors the full impact on its business of hurricanes Katrina, Rita, and Wilma (the "2005 Hurricanes"); (2) that, in fact, the Company's cost of the 2005 Hurricanes had doubled to an estimated $758 million to $788 million; (3) that the magnitude of the loss would cause the Company to lose key financial-strength and credit ratings from A.M. Best, an influential industry-rating agency (3) that the Company concealed the losses in order to complete a $114 million secondary offering and raise more than $350 million from an offering of perpetual preferred shares; and (4) that as a consequence of the foregoing, the Company's statements with respect to its loss estimates for the 2005 Hurricane season lacked in all reasonable basis.
On February 16, 2006, after the close of the market, PXRE shocked investors when it announced that it would be increasing its estimates of the net pre-tax impact of Hurricanes Katrina, Rita and Wilma by an amount between $281 million to $311 million for the year ended December 31, 2005 compared to the high end of their prior announced estimates.
Later that same day, February 16, 2006, A.M. Best announced that it had downgraded the financial strength rating of PXRE to B++ (Very Good) from A- (Excellent).
News of PXRE's announcement regarding the impact of the 2005 Hurricanes, as well as the subsequent downgrade, sent shares of PXRE spiraling downward on February 17, 2006. By the end of the day, shares of PXRE had fallen $7.85 per share, or 65.94 percent, on high trading volume, to close at $4.05 per share.
Murray, Frank & Sailer LLP and its predecessor firms have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States.
If you purchased or otherwise acquired shares of PXRE on any world exchange between July 28, 2005 and February 16, 2006 and sustained damages, you may, no later than July 3, 2006, move the Court to serve as lead plaintiff. Shareholders outside the United States may also join the action, regardless of which exchange was used to purchase the securities. To serve as lead plaintiff, however, you must meet certain legal requirements. You can join this class action as lead plaintiff online at http://www.murrayfrank.com/CM/NewCases/NewCases.asp. If you would like to discuss this action, this announcement, or your rights and interests, please contact plaintiff's counsel Eric J. Belfi or Bradley P. Dyer of Murray, Frank & Sailer LLP.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.