HAMILTON, BERMUDA - Max Capital Group Ltd. and Harbor Point Limited announced a definitive agreement to merge with the combined company to be named Alterra Capital Holdings Limited.

Following the close of the transaction, which is expected in the second quarter of 2010, W. Marston (Marty) Becker, chairman and CEO of Max will be president and CEO of Alterra and serve as a director.

John R. Berger, director, CEO and president of Harbor Point will be CEO of reinsurance of Alterra and vice chairman of the board of directors. Berger will also chair the board's underwriting committee.

Michael O'Reilly, chairman of Harbor Point's board of directors and former vice chairman and chief financial officer of The Chubb Corp., will be the non-executive chairman of Alterra's board of directors.

Becker commented, "With capital of approximately $3 billion, in a market that values strength and size as a sign of franchise safety and sustainability, Alterra will be well positioned to take full advantage of profitable growth opportunities in the P&C insurance and reinsurance markets. Harbor Point brings significant intellectual capital to Alterra with a highly experienced, very well-regarded reinsurance team that writes complementary lines to Max."

Added Berger, "The combination of our companies will produce a highly diverse portfolio of specialty insurance and reinsurance business, including a mix of long and short-tail lines. As a result, we expect that Alterra will have less volatile underwriting results than either of its individual components, as well as more flexibility to efficiently manage capital."

Under the terms of the merger, which was described as a "merger of equals," holders of Harbor Point common stock will each receive a fixed exchange ratio of 3.7769 Max common shares for each Harbor Point share. In addition, a special cash dividend of $2.50 per share is planned for all shareholders of the combined company following the closing (approximately $300 million in total).

The merger, which is subject to shareholder and regulatory approvals, will result in Harbor Point shareholders owning approximately 52% of the combined company on a fully diluted basis, with Max shareholders owning approximately 48%.(IAM News)


 

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