Acquisition

CGNU PLC
14 June 2001


CGNU acquires Fortis' Australian business

CGNU plc (CGNU) announces the acquisition of Fortis Australia Limited (FAL)
from Fortis Group for A$293 million (£111 million) in cash. In addition Fortis
will receive a dividend of A$37 million (£14 million) from FAL prior to
completion.

The FAL operations are principally in general insurance but also include a
small life insurance business.

FAL has a strong business fit with CGNU's existing Australian general
insurance operations. The acquisition will create the market leader in both
the motor dealer and financial institution distribution channels, areas in
which CGNU is already strong.

FAL had net written premiums of A$269 million (£102 million) in 2000, of which
71% were personal lines, and made a profit after tax of A$35 million (£13
million). The combined operating ratio for 2000 was 99% and net assets at 31
December 2000 were A$234 million (£89 million).

The major operations of both CGNU and FAL are in Melbourne and CGNU expects to
reduce FAL's operating costs by some 40%, which would generate estimated
annualised pre-tax cost savings of A$23 million (£9 million).

The transaction is subject to regulatory approval and is expected to complete
by the end of the third quarter 2001.

Philip Twyman, group executive director for CGNU said:

'This is a focused acquisition which reinforces our top five position in the
Australian general insurance market, where premium rates continue to harden.
It also provides opportunities for cost savings from a business that is
already performing well.'

Enquiries:

Analysts/Investors
James Matthews, Head of Investor Relations      [phone]

Media
Ian Frater, Head of Group Media Relations       [phone]
Alex Child-Villiers, Financial Dynamics         [phone]          
   

Notes to editors:

CGNU is the world's sixth-largest insurance group and the largest insurer in
the UK. It has worldwide premium and investment sales from ongoing business of
£27 billion and more than £210 billion in assets under management.

CGNU has long-term savings, investment and general insurance businesses in
Australia including its 'fund of funds' open architecture business, Navigator.
In 2000 the Australian general insurance business had net written premiums of
A$1,152 million (£438 million) and a  combined operating ratio of 103%.

Exchange rate:        £1: A$2.63