XL Capital Ltd
Cumberland House
One Victoria Street
P. O. Box HM 2245
Hamilton HM JX
Bermuda
Phone: (441) 292-8515
Fax: (441) 292-5280
NEWS RELEASE
IMMEDIATE
Contact: Gavin R. Arton Roger R. Scotton
Investor Relations Media Relations
441-294-7104 441-294-7165
XL CAPITAL LTD TO PURCHASE WINTERTHUR INTERNATIONAL FROM CREDIT SUISSE GROUP
COMBINATION TO CREATE GLOBAL LARGE
COMMERCIAL INSURANCE BUSINESS
HAMILTON, BERMUDA (February 16, 2001) - XL Capital Ltd (NYSE: XL) ("XL")
announced today that it has agreed to purchase Winterthur International from
Winterthur Insurance ("Winterthur"), a subsidiary of the Credit Suisse Group
("CSG"). The all-cash transaction is valued at approximately $600 million and
will be funded by XL out of current resources.
Winterthur International is the international, large commercial account property
and casualty insurance business of Winterthur. Winterthur International operates
in 27 countries, has a staff of more than a thousand and in 2000 had gross
written premiums and net earned premiums of approximately $1.3 billion and $600
million, respectively. In terms of premium volume, Winterthur International's
top five markets are the U.K., Switzerland, Germany, the U.S. and
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France. Other significant markets include Italy, Belgium, Denmark, Hong Kong,
Japan and the Netherlands.
As of September 30, 2000, Winterthur International (including certain operations
to be retained by CSG) had investment assets of approximately $1.9 billion and
net loss reserves of approximately $1.0 billion. XL will be purchasing a
combination of insurance companies, including Winterthur International Insurance
Company based in the United Kingdom, Winterthur International in Switzerland and
Winterthur International America Insurance in the United States, and selected
Winterthur International insurance portfolios. Additionally, XL intends to
continue Winterthur International's strategic alliance with Travelers Insurance
for the production of global solutions for their multinational customers.
XL President and Chief Executive Officer Brian M. O'Hara said: "We believe our
purchase of Winterthur International's global risk management business will
provide XL with a superior franchise and the capability to serve our large
commercial customers on a truly global basis. This will result in expansion of
our core risk management business, which we expect will further complement our
other insurance operations. We are acquiring a high quality underwriting
business known for its client servicing capabilities. We believe that this will
give us the opportunity to leverage the XL and Winterthur International
franchises, creating a powerful combination that gives us added global reach and
critical mass with very little overlap with our existing insurance operations.
Our customers will benefit from the service capabilities of our global
infrastructure across all lines together with more products and solutions to
help manage the risks of their business."
Credit Suisse Financial Services and Winterthur Group Chief Executive Officer
Thomas Wellauer said: "Winterthur International is one of the leading insurers
in total risk management for large national and multinational corporates and XL
Capital provides an ideal environment for this business. Additionally, the sale
of Winterthur International enables us to
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complete our strategic efforts to focus on our core activities in the insurance
business. We plan to use the proceeds from the sale to further reinforce our
strong position in Europe."
Nicholas M. Brown Jr., XL's Chief Executive for Insurance Operations, said: "The
addition of Winterthur International's business and strong management team will
increase the gross written premiums of our insurance division to approximately
$3 billion. This is a significant strategic expansion for XL. We are pleased
that Willi Suter, the Chairman and Chief Executive Officer of Winterthur
International, has agreed to lead our new global risk management operation. We
are also pleased that Clive Tobin, Chief Executive Officer of XL Insurance in
Bermuda, will become Deputy Chief Executive Officer and Chief Underwriting
Officer of this new unit. After the transaction closes, XL intends to change the
name of the unit to "XL Winterthur International."
Winterthur International Chief Executive Officer Willi Suter said: "I believe
that joining XL offers the combined group an ideal opportunity to be a true
global innovator in total risk management and to realise our full potential as a
market leader. With Winterthur International's primary infrastructure focused on
large risk customers and its strong position in Europe as an insurer of large
multinationals, the combined operation will be more globally diversified and
able to take advantage of positive trends currently underway in our core risk
management markets."
The transaction, which does not include Winterthur International's Strategic
Risk Solutions unit, its motor business or its life and pensions business, is
subject to the satisfaction of customary conditions precedent, including receipt
of applicable regulatory approvals, and is expected to be completed in the
second quarter of this year.
XL Capital Ltd, through its operating subsidiaries, is a leading provider of
insurance and reinsurance coverages and financial products to industrial,
commercial and professional service firms, insurance companies, and other
enterprises on a worldwide basis. As of December 31,
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2000, XL Capital Ltd had consolidated assets of approximately $16.8 billion and
consolidated shareholders' equity of approximately $5.6 billion. More
information about XL is available on www.xlcapital.com.
This press release may contain forward-looking statements. Such statements are
based on current plans, estimates and expectations and, accordingly, involve
inherent risks and uncertainties including, but not limited to, business,
financial and integration risks associated with the acquisition and the risk
that the acquisition will not be consummated. Additional risk factors are
identified in XL's most recent annual report on Form 10-K and other documents on
file with the Securities and Exchange Commission which could cause actual
results to differ materially from those contained in forward-looking statements.
XL Capital does not undertake any duty to update publicly any forward-looking
statements contained herein in light of new information or future developments.
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