Offer for capacity - Part 1

Amlin PLC
02 August 2002

PART 1

For immediate release:                                        2 August 2002

Not for release, publication or distribution in or into the United States,
Canada, Japan or Australia or any Prohibited or Excluded Territory.



PRESS RELEASE

Recommended Offer by Amlin plc on behalf of Amlin Corporate Member Limited to
acquire all of the outstanding Capacity on Syndicate 2001 not already owned by
the Group

Amlin, the largest independent business operating in the Lloyd's market, today
announces an offer (on behalf of ACM, a wholly-owned subsidiary of Amlin) to
acquire all of the outstanding Capacity on Syndicate 2001, for the 2003 and each
subsequent year of account, which the Group does not already own.

Key points:

•         The Capacity Offer consideration comprises New Amlin Shares or cash
and, in each case, 'Limited Tenancy Capacity' for the 2003 year of account only.
For each £1 of Capacity currently held, it comprises:



(i) 0.2558 New Amlin Shares, valued at approximately 22p (based on the closing
mid-market price per Amlin share on 31 July 2002), together with the retention
of the right to participate on Syndicate 2001 for the 2003 year of account only
with the equivalent of a premium income limit of 50p ('the Share Offer'); or



(ii) 20p in cash together with the retention of the right to participate on
Syndicate 2001 for the 2003 year of account only with a premium income limit of
50p ('the Cash Alternative'); or



(iii) a combination of (i) and (ii).



•         Lloyd's members agents are recommending acceptance of the Capacity
Offer to Members of Syndicate 2001 whom they advise.



•         Amlin has received irrevocable undertakings to accept the Capacity
Offer from, or on behalf of, Members (subject to individual MAPA Members
indicating to the contrary to their members' agents) in respect of Capacity
totalling £84.8 million, representing 38.2 per cent of the Capacity not already
owned by the Group.



•         If Members accept the Share Offer in full, it will result in Amlin
issuing approximately 56,708,346 New Amlin Shares valued at £48.8 million (based
on the closing mid-market price per Amlin share on 31 July 2002).



•          If Members accept the Cash Alternative in full, it would result in
Amlin paying £44.3 million consideration.



•          The Capacity Offer is conditional, inter alia, upon Amlin
Shareholders' approval and the receipt of valid acceptances in respect of at
least 64 per cent. of Relevant Capacity, subject to Amlin's discretion to
proceed with the Capacity Offer at a lower level of acceptances.  If 64 per
cent. of Relevant Capacity is tendered pursuant to the Capacity Offer, Amlin
intends to seek Lloyd's permission to proceed with a compulsory minority buy-out
of any remaining Capacity.



•          Upon the Capacity Offer becoming unconditional in all respects,
Amlin will increase the Capacity of Syndicate 2001 by 25 per cent. to £1
billion.   Accordingly, the 2003 year of account premium income limit of 50p for
each £1 of Capacity currently held will be increased to 62.5p for Members who
accept the Capacity Offer.



•          Assuming the Capacity Offer is taken up in full and Members
underwrite the whole of their Limited Tenancy Capacity, Amlin will underwrite
£862 million of Capacity for the 2003 year of account on the basis that it has
sufficient funding in place to support that level of Capacity.  This represents
an increase of 49 per cent. over Amlin's dedicated capacity of £578 million for
the 2002 year of account.



•          Following the £80 million equity financing completed in July 2002,
Amlin will require up to £43.2 million of additional debt finance to support
£862 million of Capacity for the 2003 year of account.  The amount will depend
on the proportion of Members accepting the Share Offer as opposed to the Cash
Alternative and assumes no material change in Lloyd's risk based capital ratios.



Charles Philipps, Chief Executive of Amlin plc, commented, 'the recommended
Capacity Offer is a win win for both Members and Amlin.  We believe that the
Capacity Offer, including the right to participate on Syndicate 2001 on a
limited basis for 2003, represents very fair value for Members.  Amlin now
stands an excellent chance of achieving its strategic objective of 100 per cent.
ownership of Syndicate 2001.  With this, we will have greater flexibility in
managing our underwriting activities going forward and we will have a strong
base on which to build value for our shareholders'.



Enquiries:

For further information contact:

Amlin plc



Charles Philipps                   Group Chief Executive   Tel: [phone]

Richard Hextall                    Group Finance Director  Tel: [phone]


KPMG Corporate Finance


Richard Barlow                     Director                Tel:  [phone]


Haggie Financial


David Haggie                                                Tel: [phone]



The contents of this announcement have been approved by KPMG Corporate Finance
of 8 Salisbury Square, London EC4Y 8BB for the purpose of section 21 of the
Financial Services and Markets Act 2000.

KPMG Corporate Finance, a division of KPMG LLP which is authorised by the
Financial Services Authority for investment business activities, is acting as
Lloyd's Sponsor and as financial adviser to Amlin in relation to the Capacity
Offer and is not acting for anyone else in relation to such Capacity Offer.
KPMG Corporate Finance will not be responsible to anyone other than ACM or Amlin
for providing the protections afforded to its clients or for providing advice in
relation to the Capacity Offer.

The Share Offer, which forms part of the Capacity Offer, is not being made
available to Members who are resident or domiciled outside the United Kingdom or
who are US persons. Such Members (other than Members resident or domiciled in
the Prohibited Territory or in any of the Excluded Territories) may only accept
the Cash Alternative. Neither the Share Offer nor the Cash Alternative is being
made available to Members resident or domiciled in the Prohibited Territory or
in any of the Excluded Territories.

This announcement does not constitute a solicitation, invitation or offer to
persons in the United States or any other jurisdiction where a solicitation,
invitation or offer could be contrary to law.  Accordingly, this announcement is
not being, and must not be, mailed or otherwise distributed or sent in, into or
from the United States, (whether by use of the mails or by any means or
instrumentality of interstate or foreign commerce), Canada, Japan or Australia
or the Prohibited Territory or Excluded Territories and persons receiving this
announcement (including custodians, nominees and trustees) must not distribute
or send it in, into or from the United States, Canada, Japan or Australia or the
Prohibited Territory or Excluded Territories.

This announcement does not constitute an offer or an invitation to purchase or
subscribe for any securities. The New Amlin Shares which may be issued pursuant
to the terms of the Capacity Offer may be illiquid and there may not be a market
for them. The value of securities may go down as well as up.

Terms as defined in the Capacity Offer Document shall have the same meaning in
this announcement.

Any person considering accepting the Capacity Offer should read carefully the
Capacity Offer Document relating to the Capacity Offer and the risk factors set
out therein.  The Capacity Offer Document is expected to be issued on 2 August
2002.

This announcement has been prepared in accordance with Lloyd's requirements.
Amlin has confirmed to Lloyd's that this announcement complies with the Capacity
Offer Rules.  This announcement has not been approved by Lloyd's.

NOTE FOR EDITORS:

Information on Amlin and Syndicate 2001

Amlin is the largest independent business operating in the Lloyd's market
(measured by owned and managed premium income for the 2002 year of account).

Amlin operates through Syndicate 2001, which has a premium income limit for the
2002 year of account of £800 million. This has been supplemented by quota share
reinsurance facilities which allow Syndicate 2001 to underwrite up to a further
£100 million of premium income. Over the past three years, Amlin has focused its
activities on Syndicate 2001, divesting non-core interests, such as it Lloyd's
members' agencies and its interests in Lloyd's third party syndicates. Amlin has
successfully grown its ownership of Syndicate 2001's capacity to 72.3 per cent.
for the 2002 year of account, compared with 38.0 per cent. for the 1999 year of
account. Syndicate 2001 has a diversified book of insurance business.


                      This information is provided by RNS
            The company news service from the London Stock Exchange

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