AMBAC announces initial public equity offering by its health care subsidiary, HCIA Inc.

NEW YORK--(BUSINESS WIRE)--Feb. 21, 1995--AMBAC Inc. (NYSE:ABK) today announced an initial public offering by its Baltimore-based health care information subsidiary HCIA Inc. of 1.75 million shares of HCIA common stock at a price of $14.00 per share.

HCIA has also granted the underwriters an option to purchase up to 262,500 shares to cover any over-allotments. The stock will trade on the NASDAQ National Market under the symbol "HCIA."

Upon completion of the sale, AMBAC Inc. will own approximately 73% of the HCIA's outstanding common stock, or approximately 70% if the underwriter's over-allotment option is exercised in full.

Net proceeds from the offering will be used to repay certain indebtedness to AMBAC and for general corporate purposes, including the acquisition and development of additional businesses, products and technologies.

Alex Brown & Sons Incorporated and Hambrecht & Quist Incorporated are acting as managing underwriters.

HCIA Inc. is a leading health care information company that develops and markets integrated clinical and financial information systems and products.

AMBAC Inc. is a holding company that provides through its affiliates financial guarantee insurance, financial services and health care information services to both public and private clients throughout the United States.

EDITOR'S NOTE

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. A written prospectus regarding the public offering may be obtained from Alex Brown & Sons Inc., 135 East Baltimore Street, Baltimore, MD. 21202.

CONTACT: Investor Contact:

Gayle F. Robinson, 212/208-3357

or

Media Contact:

John M. Cathey, 212/208-3490