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 NEW YORK, Oct. 7 /PRNewswire/ -- Alleghany Corporation announced today that it has acquired Underwriters Reinsurance Company from a holding company formerly owned by the Continental Corporation, Goldman, Sachs & Co. and certain affiliated investment partnerships, and members of Underwriters Reinsurance management, pursuant to an agreement announced in July. At the closing, Alleghany paid cash totalling about $201 million and received, in exchange, about 93 percent of the equity of a new holding company that owns Underwriters Reinsurance. The remaining 7 percent of the new holding company's equity is owned by Underwriters Reinsurance management.
 Underwriters Reinsurance provides reinsurance to property and casualty insurers and reinsurers. Although it underwrites many lines of business, Underwriters Reinsurance concentrates on coverages requiring specialized underwriting expertise, including certain excess and surplus lines programs, umbrella liability, and directors' and officers' liability. Underwriters Reinsurance also owns a recently formed property and casualty primary insurance subsidiary, Commercial Underwriters Insurance Company, which concentrates on specialized insurance lines. Underwriters Reinsurance is headquartered in Woodland Hills, Calif. and has branch offices in Atlanta, Chicago, Houston, Los Angeles and New York.
 All of the consolidated assets and liabilities of the holding company that formerly owned Underwriters Reinsurance, known as Underwriters Re Holdings Corp., are now held by the corporate entities acquired by Alleghany. As reported under generally accepted accounting principles, Underwriters Re Holdings' consolidated assets and stockholders' equity as of June 30, 1993 were $1.1 billion and $146.0 million, respectively, and its net income was $28.5 million on revenues of $213.9 million in 1992 and $9.3 million on revenues of $127.1 million in the first six months of 1993. As of June 30, 1993, Underwriters Reinsurance reported statutory surplus of $181.3 million. A.M. Best Company, the independent industry rating organization, recently upgraded its rating of Underwriters Reinsurance to "A" (Excellent) from "A-" (Excellent), citing Underwriters Reinsurance's strong capital base, reduced debt service obligations and operating performance.
 John J. Burns Jr., president and chief executive officer of Alleghany, commented: "Since its present management took over in 1987, Underwriters Reinsurance has established an impressive record of growth and profitability. Reflecting this record, from Dec. 31, 1987 to June 30, 1993 Underwriters Re Holdings reported an increase in stockholders' equity from $15.7 million to $146.0 million and a reduction of $75.0 million in its senior debt.
 "We intend to support the continued growth of Underwriters Reinsurance through additional investment and the accumulation of retained earnings; in particular, we plan to make an additional investment in Underwriters Reinsurance sufficient to increase its statutory surplus to approximately $250 million by year-end.
 "Our agreement to acquire Underwriters Reinsurance marks an important milestone in Alleghany's ongoing program to redeploy its liquid assets into well-managed operating businesses, and we are delighted to welcome Underwriters Reinsurance and its fine management to the Alleghany family of companies."
 Steven H. Newman, president and chief executive officer of Underwriters Reinsurance, stated: "Alleghany's financial strength and integrity will further assure the marketplace of our long-term stability and permit Underwriters Reinsurance to continue to provide high-quality service to our clients. We are extremely pleased to have become a member of the Alleghany family of companies, and we look forward to a long and rewarding relationship."
 Headquartered in New York City, Alleghany Corporation is engaged, through its subsidiaries, Chicago Title and Trust Company, Sacramento Savings Bank and World Minerals Inc., in the businesses of title insurance, investment management, retail banking and industrial minerals. Alleghany also conducts a steel fastener importing business through its heads and threads division.
 -0- 10/7/93
 /CONTACT: T.E. Somerville of Alleghany Corporation, 212-752-1356, or P.A. Bengelsdorf of Underwriters Reinsurance Company, 818-225-1000/

CO: Alleghany Corporation; Underwriters Reinsurance Company ST: New York IN: INS FIN SU: TNM

SM-OS -- NY066 -- 9887 10/07/93 16:27 EDT
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Publication:PR Newswire
Date:Oct 7, 1993

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