EXHIBIT 99 (r)
PRESS
RELEASE
CONTACT: Dennis Beaulieu
(603) 640-2206
WHITE MOUNTAINS CLOSES
CGU ACQUISITION
HAMILTON, Bermuda, June 1, 2001 - White Mountains Insurance Group, Ltd. today
completed its previously announced acquisition of CGNU plc's U.S. property and
casualty operations, CGU.
Boston-based CGU, which will be renamed shortly, has become a wholly-owned
subsidiary of White Mountains. White Mountains Chairman, Jack Byrne said, "We
are delighted to bring this exciting acquisition to a successful finish." The
definitive stock purchase agreement, as amended, as well as related debt and
equity financing terms and conditions were previously filed with the
Securities and Exchange Commission.
White Mountains fully diluted shares outstanding will increase to 10 million
shares. Jack Byrne said, "Since September we have increased the equity and
reduced the debt components of the transaction. CGU's loss reserves were
significantly strengthened at year-end and we purchased significant adverse
development reinsurance covers at closing. All these actions resulted in a
reduced tangible book value but a much stronger balance sheet. As a result of
the transaction, we estimate that our post-closing tangible book value has
increased to approximately $290 per share, prior to the impact of purchase
accounting adjustments."
Participating in the deal are principal equity partners Berkshire Hathaway,
Franklin Mutual Advisors, Leucadia National Corporation, Banc One Capital
Corp., Fairfax Financial Holdings Limited, Gotham Partners, Markel
Corporation, Prospector Partners, CSFB Private Equity, through DLJ Merchant
Banking Partners III, CAI Managers & Co., L.P., Fairholme Capital Management,
Northaven Management, Inc., and Wyper Capital. The debt facility was arranged
by Lehman Brothers Inc. Jack Byrne said, "We are fortunate to have assembled
a world class group of equity and debt partners. We appreciate their
commitment and support."
White Mountains is a Bermuda-domiciled financial services holding company traded
on the New York Stock Exchange under the symbol WTM. Additional financial
information and other items of interest are available at the company's web site
located at www.whitemountains.com.
CORPORATE HEADQUARTERS: EXECUTIVE OFFICES:
- ---------------------- -----------------
WHITE MOUNTAINS INSURANCE GROUP, LTD. WHITE MOUNTAINS INSURANCE GROUP, LTD.
12 CHURCH STREET, SUITE 322 80 SOUTH MAIN STREET, HANOVER, NH 03755
HAMILTON, HM 11 BERMUDA PH: 603-643-1567 * FAX: 603-643-4562
PH: 441-296-6011 / FAX: 441-296-9904
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This press release contains forward looking statements within the meaning of
the "safe harbor" provisions of the United States Private Securities
Litigation Reform Act of 1995. White Mountains cautions that a number of
important factors could cause actual results to differ materially from the
plans, objectives, expectations, estimates and intentions expressed in
forward-looking statements made by White Mountains. These factors include:
(i) competitive forces, including the conduct of other property and casualty
insurers and reinsurers, (ii) changes in domestic or foreign laws or
regulations applicable to White Mountains, its competitors or its clients,
(iii) an economic downturn or other economic conditions (such as a rising
interest rate environment) adversely affecting White Mountains' financial
position and (iv) loss reserves and other balance sheet items established by
White Mountains subsequently proving to have been inadequate. White Mountains
cautions that the foregoing list of important factors is not exhaustive. In
any event, such forward-looking statements made by White Mountains speak only
as of the date on which they are made, and White Mountains does not undertake
any obligation to update or revise such statements as a result of new
information, future events or otherwise.
CORPORATE HEADQUARTERS: EXECUTIVE OFFICES:
- ---------------------- -----------------
WHITE MOUNTAINS INSURANCE GROUP, LTD. WHITE MOUNTAINS INSURANCE GROUP, LTD.
12 CHURCH STREET, SUITE 322 80 SOUTH MAIN STREET, HANOVER, NH 03755
HAMILTON, HM 11 BERMUDA PH: 603-643-1567 * FAX: 603-643-4562
PH: 441-296-6011 / FAX: 441-296-9904