Capital Re announces agreement to acquire RGB Underwriting Agencies.NEW YORK--(BUSINESS WIRE)--Oct. 7, 1996--Capital Re Corp. (NYSE NYSE See: New York Stock Exchange : KRE KRE Kauffman Racing Equipment KRE Kuwait Real Estate (bank) KRE Keffalas Real Estate, Inc KRE Key Results Expected KRE Karl Real Estate KRE Kernel Rules Enforcement KRE Korea Research Environment ) and the shareholders of Tower Street Holdings Limited announced today that they have signed a memorandum of understanding A Memorandum of Understanding (MoU) is a legal document describing a bilateral or multilateral agreement between parties. It expresses a convergence of will between the parties, indicating an intended common line of action and may not imply a legal commitment. for the acquisition by Capital Re of 100% of the issued shares of Tower Street Holdings Limited, the ultimate parent company of RGB (Red Green Blue) The computer's native color space, which is the color system for capturing and displaying images. RGB was derived from our own perception of color because human eyes are sensitive to red, green and blue (see trichromaticity). Underwriting Agencies Ltd. RGB is a Lloyd's managing agency and presently manages three syndicates, non-marine syndicate 490 and two life syndicates, 1171 and 332, with capacity of over 100 million British pounds. In connection with this acquisition and with the completion of reconstruction and renewal at Lloyd's, Capital Re will establish a corporate member at Lloyd's to support underwriting on the managed syndicates. Capital Re's participation in RGB and its syndicates will provide it with access to the principal international market for specialty insurance and reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. products. RGB has an excellent reputation at Lloyd's and is recognized as a market leader in many lines of business. The acquisition is subject to the completion of due diligence, Lloyd's approval, and the execution of definitive documents, in addition to customary closing conditions. Completion of the acquisition is expected by year end 1996. Michael E. Satz, chairman, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Capital Re said, "The acquisition of RGB is consistent with the strategic direction of Capital Re to diversify into specialty products in order to maintain earnings growth and target a return on equity in the mid-teens. In partnership with RGB, we anticipate a coordinated strategic initiative allowing the Capital Re corporate group to more actively pursue diversification of its specialty businesses. The opportunity for product development and the business expansion arising from this acquisition should produce a material and sustainable accretion to earnings." Peter Brotherton, director of RGB in welcoming the collaboration commented, "The proposed partnership with Capital Re will provide the financial strength and stability required for the group's development into the next millennium. In acquiring RGB, Capital Re has not only recognized the quality of our underwriters, but also the unique opportunities that exist at Lloyd's for global expansion." Capital Re Corp., headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , is the holding company for several specialized professional reinsurance companies, Capital Reinsurance Company, Capital Mortgage Reinsurance Company, Capital Credit Reinsurance Company Ltd., and Capital Title Reinsurance Company. Capital Reinsurance Company, rated triple-A by Standard & Poor's Corporation and Moody's Investors Service Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. , is the leading reinsurer re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. of financial guarantees of investment-grade debt obligations. Capital Mortgage Reinsurance Company, rated AA by Standard & Poor's Corporation, is a professional reinsurer dedicated exclusively to serving the mortgage guaranty insurance industry. Capital Credit Reinsurance Company Ltd. specializes in providing reinsurance capacity to the trade credit insurance market and to other credit-related insurance lines. Capital Title Reinsurance Company, rated AA- by Standard and Poor's Noun 1. Standard and Poor's - a broadly based stock market index Standard and Poor's Index Corporation and Duff & Phelps Inc., is the first professional reinsurer dedicated exclusively to the title insurance industry. Capital Re's total assets at June 30, 1996 reached $1.1 billion. Total stockholders' equity stood at $448.6 million. CONTACT: Capital Re Corporation Alan S. Roseman/Catherine C. Bailey 212/974-0100 or RGB Underwriting Agencies Ltd. Robin Bruce-Gardner, 0171-283-0802 |
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