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SALE OF AMERICAN RE-INSURANCE COMPANY COMPLETED

SALE OF AMERICAN RE-INSURANCE COMPANY COMPLETED
 PRINCETON, N.J., Sept. 30 /PRNewswire/ -- American Re Corporation and Aetna Life & Casualty (Aetna) today announced the closing of the previously announced purchase of American Re-Insurance Company (Am Re) by American Re Corporation. American Re Corporation is a holding company recently formed by Kohlberg Kravis Roberts & Co. (KKR) and Am Re management. Am Re is the third largest property and casualty reinsurer in the United States on the basis of total surplus.
 The transaction closed under terms previously announced, except that $100 million of American Re Corporation's senior subordinated debentures which Aetna had previously agreed to purchase were instead sold as part of American Re Corporation's public offering. As a result, Aetna received a total of $1.31 billion in cash at closing and will receive up to an additional $20 million cash, payable in December 1992. Aetna also received $70 million of American Re Corporation's 14 percent pay-in-kind preferred stock, approximately $30 million of the common stock of American Re Corporation, and retained most of Am Re's U.K. operations, which have an aggregate book value of approximately $30 million. The previously announced estimated gain will be reported in Aetna's third quarter financial results. The capital raised by Aetna through the sale will be employed for its general corporate purposes.
 "American Re has a very bright future as an independent company," said Edward B. Jobe, chairman and CEO of American Re Corporation. "With an even greater entrepreneurial focus and KKR's financial support, American Re is equipped to handle its clients' toughest needs for reinsurance and related services. The exceptionally strong support of the financing for this transaction reflects the high regard the financial markets have for the new American Re as well."
 Aetna Chairman Ronald E. Compton said, "As the sole shareholder of American Re-Insurance Company, we have enjoyed a good relationship with the company's management and, as a minority shareholder of American Re Corporation, we look forward to participating in the company's continued success."
 American Re Corporation is, through its wholly owned subsidiary, American Re-Insurance Company, a direct writer of treaty and facultative reinsurance and related services, with 1,150 employees in 13 domestic and 13 international offices.
 -0- 09/30/92
 CONTACT: Robert M. Hall of American Re Corporation, 609-243-4330, or Chris Heller of Aetna Corporation, 203-273-2603, CO: AMERICAN RE CORPORATION; AETNA LIFE & CASUALTY;
 AMERICAN RE-INSURANCE COMPANY


IN: INS SU: TNM ST: NJ -- NY069 -- X626 09/30/92
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Publication:PR Newswire
Date:Sep 30, 1992
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