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AMERICAN RELIANCE GROUP: SHAREHOLDERS APPROVE ASSET PURCHASE AGREEMENT

 LAWRENCEVILLE, N.J., June 22 /PRNewswire/ -- American Reliance Group, Inc. (AMEX: ARI) announced that at its annual meeting of shareholders held today the shareholders of the company approved the sale by the company and its wholly owned subsidiary, American Reliance Casualty Company, of substantially all of the assets of the companies to Vik Brothers Insurance, Inc. and certain of its affiliates pursuant to an Asset Purchase Agreement, dated as of Feb. 12, 1993, among Vik Brothers, the companies and American Reliance Insurance Company (collectively, American Reliance).
 The closing of the transactions contemplated by the Asset Purchase Agreement is currently scheduled to occur on June 30, 1993. The New Jersey Department of Insurance approved the transactions on June 21, 1993. Consummation remains subject to approval of the transaction by the policyholders of American Reliance Insurance Company. The company's shareholders also approved, subject to the closing of the transaction, the change of the name of the company from "American Reliance Group, Inc." to "ARI Holdings, Inc."
 Vik Brothers will assume all of the American Reliance insurance business written after 1988, except Florida business and New Jersey private passenger automobile business. Vik Brothers will also assume certain non-insurance liabilities of American Reliance and purchase certain assets, including the headquarters building located in Lawrenceville.
 At closing, Vik Brothers will pay the company an initial consideration of approximately $15 million. Such consideration will consist of $6 million for the headquarters building and the other tangible assets transferred at closing, and $9 million representing the company's 60 percent share of the ceding commission in connection with the assumption reinsurance.
 As post-closing consideration, American Reliance will receive a payment of 8 percent of the direct premiums written on the assumed business for the one-year period following closing and a payment of 3.5 percent of the direct premiums written on the assumed business for the second one-year period following closing. The company will receive 60 percent of these post-closing payments.
 American Reliance Group, Inc., a property and casualty holding company, specializes in providing insurance coverage in New Jersey, Pennsylvania, Delaware, Maryland and Virginia to small and medium-size businesses and individuals located primarily in rural and suburban locations.
 The Vik Brothers insurance group includes, among others, LMI Insurance Company and State Capital Insurance Company. The group specializes in habitational coverages, both commercial and personal, throughout the United States.
 /delval/
 -0- 6/22/93
 /CONTACT: Bruce W. Herrick, chairman and president, or Dennis M. Bandish, senior vp-finance of American Reliance, 609-896-1921/
 (ARI)


CO: American Reliance Group, Inc.; American Reliance Casualty Company;
 Vik Brothers Insurance, Inc.; ARI Holdings, Inc. ST: New Jersey IN: INS SU: TNM


LJ-MP -- PH037 -- 4644 06/22/93 14:55 EDT
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Publication:PR Newswire
Date:Jun 22, 1993
Words:445
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