Alleghany Corporation Announces Proposed Acquisition of Venton Holdings Ltd.

NEW YORK--(BUSINESS WIRE)--July 30, 1998--Alleghany Corporation announced today that its subsidiary, Underwriters Reinsurance Company, has signed an agreement to acquire Venton Holdings Ltd., a Bermuda-based holding company which conducts a global insurance and reinsurance business with operations in London as well as Bermuda. At the closing, Underwriters Re will pay cash totalling $190 million to acquire all of the equity of Venton from the current owners, including Trident Partnership, L.P., X.L. Insurance Company, Ltd., Risk Capital Reinsurance Company and members of Venton management. Underwriters Re also will assume about $123 million in letter of credit obligations which support the activities of Venton's subsidiary Venton Underwriting Limited ("VUL") as an underwriting corporate member of Lloyd's. The closing, which is subject to customary legal conditions and to approval of the transaction by insurance regulatory authorities in New Hampshire and Bermuda and to approval by the Council of Lloyd's, is expected to take place by November of this year.

In addition to VUL, Venton owns Venton Underwriting Agencies Limited, a Lloyd's managing agency ("VUA"). VUA was established by Jeremy Venton in 1988, who is now in charge of Venton's Bermuda operations. The insurance and reinsurance business underwritten by Venton is broad-based with a well-diversified product mix of property, casualty, marine and other risks. Its risks are located around the world, primarily in the United States, the United Kingdom, Western Europe, Canada and Australia. For 1998, Venton through its subsidiaries is managing (pound)271.5 million in capacity, of which VUL provides approximately 62%. On a U.S. GAAP basis, assuming 100% utilization of the 1998 capacity, this would equate to approximately $583 million of gross premiums including brokerage commissions.

Steven H. Newman, Chairman and Chief Executive Officer of Underwriters Re, commented: "Venton has established an impressive record of growth and profitability. We look forward to welcoming Jeremy Venton and his fine management team to our family of companies. We believe that Underwriters Re and Venton will fit very well together, both in terms of complementary businesses and in the compatibility of management. The acquisition of Venton adds to our product diversity and expands our ability to compete in the global marketplace."

Jeremy Venton, Chairman of Venton Holdings Ltd., commented: "This is a marriage made in heaven. We at Venton are delighted to be joining the Alleghany family and look forward to working with our friends at Underwriters Re to create one of the most profitable and innovative companies in the international insurance and reinsurance industry."

Martin Slade, Managing Director of VUA, commented: "This transaction provides our employees, clients and broking contacts with the certainty and security that comes with being part of a major U.S. corporation with a longstanding track record of success in and commitment to the insurance sector. Those elements will prove increasingly important as Lloyd's develops into the twenty-first century."

Headquartered in Calabasas, California with operations in Atlanta, Chicago, Houston, Los Angeles, New York, St. Louis, Connecticut and Barbados, Underwriters Re and its affiliates provide property, casualty and marine insurance and reinsurance. Underwriters Re focuses primarily on coverages requiring specialized underwriting expertise, such as excess and surplus lines, directors and officers liability, marine coverages and structured property treaties. In addition, Underwriters Re reinsures a significant book of nontraditional business and writes facultative reinsurance on a program and certificate basis. It also writes property, casualty and marine insurance through it subsidiaries Commercial Underwriters Insurance Company, Underwriters Insurance Company and Newmarket Underwriters Insurance Company.

Underwriters Re and its insurance subsidiaries carry an "A+ (Superior)" rating from A.M. Best Company, Inc. and a claims-paying ability rating of "AA-" from Standard & Poor's. As of June 30, 1998, the statutory surplus of Underwriters Re was $675 million, making Underwriters Re the ninth-largest domestic professional reinsurer in terms of statutory surplus, according to the Reinsurance Association of America.

In addition to the business conducted by Underwriters Re, Alleghany Corporation is engaged, through its subsidiaries Alleghany Asset Management, Inc. and World Minerals Inc., in the businesses of investment management and industrial minerals. Alleghany also conducts a steel fastener importing business through its Heads and Threads division. On June 17, 1998 Alleghany completed the spin-off of Chicago Title Corporation, which, through its subsidiaries, is engaged in the business of title insurance and real estate-related services. Alleghany is headquartered in New York.

    CONTACT: Robert M. Hart
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