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Swiss Re buys up British insurer

The deal is Swiss Re's second transaction in the British insurance market

(Keystone)

Swiss Re, the world’s second largest reinsurance company, says it is buying the British Life Assurance Holding Corporation for £333 million (SFr830 million) in cash.

The deal – which still needs regulatory approval - is the Zurich-based company’s second transaction in the consolidating British insurance market.

The purchase includes a subsidiary, Windsor Life Assurance Company, which administers more than 800,000 policies with total assets of around £5.2 billion.

Both transactions involve buying up life and health policies and managing them until they expire.

The company has identified this business, known as Admin Re, as a key growth area.

Convertible bonds

Swiss Re also announced it was issuing €640 million (SFr975 million) in three-year bonds, to be converted into stock to refinance debt and raise cash. It said the bond would rely on share capital already approved in 2001.

The bonds must be converted into ordinary Swiss Re shares on or around July 23, 2007, the company said.

In March, Swiss Re trounced forecasts by announcing a net profit of SFr1.7 billion ($1.33 billion) for 2003.

The result marked a return to profit after two loss-making years.

Two months later the firm received another boost when a New York jury agreed to limit its liability for the World Trade Center, which was destroyed in the September 11, 2001 attacks.

The jury upheld the WTC leaseholder’s claim that the destruction of the twin towers constituted one event rather than two.

The ruling still leaves Swiss Re, which underwrote 22 per cent of the WTC’s insurance, facing a bill of $877 million.

swissinfo with agencies

Swiss Re

Swiss Re is to buy Britain's Life Assurance Holding Corporation Limited for £333 million (SFr830 million).
The purchase includes Windsor Life, whih administers more than 800,000 policies worth £5.2 billion.
Swiss Re also reported it was issuing €640 million worth of three-year convertible bonds.

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