PartnerRe plans $350 mln of preferreds or mandatory convertibles

Nashvillle, Tenn, Oct. 26 - Pembroke, Bermuda-based PartnerRe Ltd. said Friday it plans, subject to market conditions, to raise $350 million of new capital in the form of trust preferred and convertible preferred securities, before the end of the year.

"This capital increase will also allow us to support the increased business opportunities that we anticipate for 2002," said Patrick Thiele, chief executive of PartnerRe.

"As we have said previously, our outlook for next year is very positive and we now expect premium income to grow by at least 30% during 2002. We have set as a target for 2002 operating earnings in excess of $5.50 per share and a return on beginning book value in excess of 17%, barring unexpectedly large loss events, despite issuing new securities and larger than expected losses in the third quarter 2001."

PartnerRe said a high frequency of large catastrophic events not related to the Sept. 11 attacks on the U.S., including Tropical Storm Nari, the Toulouse, France chemical explosion, a large surety loss and a refinery fire, resulted in incremental losses of $25 million for the company. As a result, PartnerRe expects a third quarter operating loss of $6.65 per share to $6.75 per share. PartnerRe plans to release third quarter earnings after market close Nov. 6, followed by a conference call at 11 a.m. ET on Nov. 7. PartnerRe shares closed off 2c to $50.42.

Also Friday, PartnerRe increased to $600 million from $400 million its shelf registration for debt securities, preferred stock, trust preferreds, common stock, warrants, stock purchase contracts and stock purchase units with the Securities and Exchange Commission Friday. The debt securities and preferreds may be convertible into stock, if the company specifies at the time of sale.

The reinsurance company, said it would use proceeds from the securities sales for working capital, capital expenditures, acquisitions and other general corporate purposes.

For the six months ended June 30, 2001, PartnerRe had an earnings to fixed charge ratio of 14.11:1 compared to 6.80:1 for the same period of 2000.

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