Merrill Lynch International Announces Debt Tender Offer for Royal & Sun Alliance Insurance Group plc 8.95% Subordinated Guaranteed Bonds Due 2029.

LONDON & NEW YORK -- Merrill Lynch International, a subsidiary of Merrill Lynch & Co., Inc. (NYSE: MER) today announced that it has commenced a cash tender offer (the "Offer") to purchase any and all of the U.S.$500 million aggregate principal amount 8.95% Subordinated Guaranteed Bonds due 2029 of Royal & Sun Alliance Insurance Group plc (the "Issuer") (CUSIP No. 78004VAB9; ISIN US 78004VAB99) (guaranteed on a subordinated basis by Royal & Sun Alliance Insurance plc (the "Guarantor")). E[acute accent]The

consideration for each U.S.$1,000 principal amount of bonds tendered and not validly withdrawn at or prior to 5:00 p.m. New York City time, on Thursday, May 4, 2006 (the "Early Participation Payment Deadline") and accepted for payment pursuant to the offer shall be by reference to a fixed spread of 1.25% over the yield based on the bid-side yield to maturity of the 5.375% U.S. Treasury Notes due February 15, 2031 (as quoted on Bloomberg Reference Page PX1), as calculated by Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Dealer Manager") at 10:00 a.m., New York City time, on Thursday, May 4, 2006. This consideration (the "Total Consideration") includes the additional payment of $40 per U.S.$1,000 principal amount of bonds accepted for purchase in the offer (the "Early Participation Payment"). E[acute accent]The consideration for each U.S.$1,000 principal amount of bonds tendered and not validly withdrawn after the Early Participation Payment Deadline but at or prior to midnight, New York City time, on Thursday, May 18, 2006, unless extended or earlier terminated (such date, the "Expiration Date") will be the Total Consideration minus the Early Participation Payment (the "Tender Offer Consideration"). E[acute accent]An Early Participation Payment will be paid only to holders of bonds who validly tender and do not validly withdraw their bonds, at or prior to the Early Participation Payment Deadline. Holders will also be paid, as applicable, accrued and unpaid interest on bonds purchased in the offer up to, but not including, the applicable payment date. E[acute accent]Payment of the Total Consideration for Bonds validly tendered and not validly withdrawn at or prior to the Early Participation Payment Deadline will be made promptly after the Early Participation Payment Deadline if such Bonds have been accepted for purchase (the date of such initial payment being the "Initial Payment Date"). Assuming the Offer is not extended, the Merrill Lynch International expects that the Initial Payment Date will be Friday, May 5, 2006. Payment of the Tender Offer Consideration for Bonds validly tendered and not validly withdrawn after the Early Participation Payment Deadline but at or prior to the Expiration Date will be made promptly after the Expiration Date if such Bonds have been accepted for purchase (the date of such final payment being the "Final Payment Date"). Assuming the Offer is not extended, the Merrill Lynch International expects that the Final Payment Date will be Friday, May 19, 2006. E[acute accent]Simultaneously with the Offer and pursuant to an exchange offer memorandum dated April 20, 2006 (the "Exchange Offer Memorandum"), the Issuer is inviting holders of bonds outside the United States (subject to the other offer restrictions set out below) to offer to exchange the bonds (the "Exchange Offer") for Sterling-denominated Perpetual Guaranteed Subordinated Capital Securities (the "New Notes"). Merrill Lynch International has undertaken with the Issuer and the Guarantor that it will offer to exchange any bonds purchased pursuant to the Offer (i) for New Notes pursuant to the Exchange Offer or (ii) for cash or New Notes in another transaction with the Issuer. E[acute accent]The Exchange Offer is only being made outside the United States (see offer restrictions set out below) and is subject to restrictions in certain other jurisdictions. To the extent that any holder of bonds participates in the Offer, such holder will only receive cash consideration in the Offer and will not be able to participate in the Exchange Offer. E[acute accent]The complete terms and conditions of the Offer are set forth in an offer to purchase dated April 20, 2006 (the "Offer to Purchase") that is being sent to holders of the bonds. Copies of the Offer to Purchase and Letter of Transmittal may be obtained from the Information Agent for the Offer, D.F. King & Co., Inc. by telephone at [phone] or [phone] (collect) or in writing at 77 Water Street, New York, New York 10006. E[acute accent]Merrill Lynch, Pierce, Fenner & Smith Incorporated is the Dealer Manager for the Offer. Questions regarding the Offer may be directed to Merrill Lynch at [phone] or [phone] (collect). E[acute accent]This announcement is not an offer to purchase or a solicitation of an offer to purchase any securities. The Offer will be made solely by the Offer to Purchase.

E[acute accent]This press release may contain forward-looking statements, including, for example, statements about management expectations, strategic objectives, growth opportunities, business prospects, and other similar matters. These forward-looking statements are not statements of historical facts and represent only Merrill Lynch's beliefs regarding future performance, which is inherently uncertain. There are a variety of factors, many of which are beyond Merrill Lynch's control, which may affect the operations, performance, business strategy and results of Issuer, the Guarantor, Merrill Lynch and the Offer and could cause those actual results and experience to differ materially from the expectations and objectives expressed in any forward-looking statements. These factors include, but are not limited to, financial market volatility; actions and initiatives taken by current and potential competitors of the Issuer and Guarantor; general economic conditions; the effect of current, pending or future legislation, regulation and regulatory actions; and the other additional factors described in Merrill Lynch's Annual Report on Form 10-K and in its subsequent reports on Form 10-Q and Form 8-K, which are available on the Merrill Lynch Investor Relations website at www.ir.ml.com and at the SEC's website, www.sec.gov. E[acute accent]Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made. Merrill Lynch does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements are made. The reader should, however, consult any further disclosures Merrill Lynch may make with respect to the offer. E[acute accent]This press release does not constitute, or form part of, an offer to buy or the invitation of any offer to sell securities in any jurisdiction nor shall it (or any part of it), or the fact of its distribution, form the basis of or be relied on in connection with any contract therefore. No indications of interest in the debt Offer described above is sought by this press release. The Offer is not being made to, and no offer to sell will be accepted from, or on behalf of, holders of securities in any jurisdiction in which the Offer is unlawful. E[acute accent]This press release must be read in conjunction with the Offer to Purchase. This press release and the Offer to Purchase contain important information, which should be read carefully before any decision is made in relation to the Offer. If you are in any doubt as to the contents of this press release or the Offer to Purchase or the action you should take, you are recommended to seek your own financial advice immediately from your stockbroker, bank manager, solicitor, accountant or other appropriately authorised independent financial adviser.

E[acute accent]OFFER RESTRICTIONS

E[acute accent]United Kingdom

E[acute accent]The Offer to Purchase is for distribution only to persons outside the United Kingdom, persons within the United Kingdom falling within the definition of Investment Professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order")) or within Article 43 of the Order, or other persons to whom it may lawfully be communicated in accordance with the Order (all such persons being referred to herein as "relevant persons"). This Offer to Purchase is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which the Offer to Purchase relates is available only to relevant persons and will be engaged in only with relevant persons.

E[acute accent]Italy

E[acute accent]The Offer is not being made in the Republic of Italy. The Offer and the Offer to Purchase have not been submitted to the clearance procedure of the Commissione Nazionale per le Societa e la Borsa (CONSOB) pursuant to Italian laws and regulations. Accordingly, holders of bonds are hereby notified that, to the extent such holders are persons resident and/or located in the Republic of Italy, no Offer is available to them and they may not offer to sell bonds pursuant to the Offer and, as such, any Electronic Order received from such persons shall be ineffective and void, and neither the Offer to Purchase nor any other offering material relating to the Offer or the bonds may be distributed or made available in the Republic of Italy.

E[acute accent]Belgium

E[acute accent]The Offer has not been notified to the Belgian Banking, Finance and Insurance Commission (Commission bancaire, financiere et des assurances) pursuant to Article 18 of the Belgian law of 22 April 2003 on the public offering of securities (the "Law on Public Offerings") nor has the Offer to Purchase been, or will it be, approved by the Belgian Banking, Finance and Insurance Commission pursuant to Article 14 of the Law on Public Offerings. Accordingly, the Offer may not be advertised and neither the Offer to Purchase nor any other information circular, brochure or similar document may be distributed, directly or indirectly, to any person in Belgium other than institutional investors referred to in Article 3, 2 of the Belgian Royal Decree of 7 July 1999 on the public character of financial transactions, acting for their own account.

E[acute accent]France

E[acute accent]The Offer is not being made, directly or indirectly, to the public in France and only qualified investors ("Investisseurs Qualifies") as defined in and in accordance with Articles L.411-2 and D.411-1 of the French Code Monetaire et Financier are eligible to accept the Offer. The Offer to Purchase or any other offering material relating to the Offer has not been and shall not be distributed to the public in France. The Offer to Purchase has not been submitted to the clearance of the Autorite des marches financiers.

E[acute accent]Notes to editors:

E[acute accent]Merrill Lynch is one of the world's leading wealth management, capital markets and advisory companies, with offices in 36 countries and territories and total client assets of approximately $1.8 trillion. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Through Merrill Lynch Investment Managers, the company is one of the world's largest managers of financial assets. Firmwide, assets under management total $544 billion. For more information on Merrill Lynch, please visit www.ml.com.