RQIH.L Regulatory News (RQIH)

Randall & Quilter Investment Holdings Ltd

Acquisition

11 October 2013

Randall & Quilter Investment Holdings Ltd ('R&Q' or the 'Group') is pleased to announce that it has acquired the entire issued share capital of Flagstone Alliance Insurance and Reinsurance LTD ('FAIR'), a Cyprus domiciled insurer and reinsurer, from the Validus Group.

FAIR, which commenced underwriting in 2000, went into run-off in 2010 and comprises primarily international reinsurance business with net reserves of c.$16.4m equivalent as at 30 June, 2013 (the date of the latest available unaudited accounts). The consideration payable by R&Q in cash from existing resources is c. $24.1m, a discount to the estimated adjusted net asset value of c. $28.1m.

The business will be managed by R&Q Insurance Services Ltd. and all of the assets of FAIR will be held in UK based bank and custodian accounts other than very nominal balances held to pay local expenses.

The Superintendent of Insurance in Cyprus has been informed of the transaction which is not subject to any further regulatory approvals.

Commenting on today's announcement, Ken Randall, Chief Executive Officer of Randall & Quilter, said:

"We are delighted to have acquired FAIR from the Validus Group after an extensive due diligence process. FAIR is our largest run-off acquisition since 2006. This purchase demonstrates our commitment to seeking out legacy portfolios which meet our return and pay-back criteria. We have reported that our pipeline is active and that in addition to further captive related acquisition opportunities, we are seeing some larger sized legacy opportunities. FAIR is proof of this and we are pleased that our recent £25m fund raise has enabled us to conclude this deal. Through customary restructuring, we expect to make this acquisition both capital and operationally efficient for the Group over the near term."

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Enquiries to:

Randall & Quilter Investment Holdings Ltd www.rqih.com

Tom Booth Tel: +00 1 441 247 8330

Numis Securities Limited

Stuart Skinner (Nominated Adviser) Tel: 020 7260 1000

Charles Farquhar (Broker) Tel: 020 7260 1000

Shore Capital Stockbrokers Limited

Dru Danford/Stephane Auton Tel: 020 7408 4090

FTI Consulting

Edward Berry / Tom Blackwell Tel: 020 7269 7297

Notes to Editors:

Since formation, Randall & Quilter has pursued a buy and build strategy to create a comprehensive range of investment activities and services in the global non-life insurance market and is focused on the following three core areas:

· Insurance Investments;

· Insurance Services; and

· Underwriting Management

The Group currently:

- has a team of up to 400 insurance professionals based in the UK, USA, Bermuda, and Continental Europe with wide service capability in both the 'live' and 'run-off' market;

- has a portfolio of 12 insurance companies in run-off (from the UK, US and Continental Europe) with net assets of c.£96.4m as at 30 June 2013;

- provides 'turnkey' management services to Lloyd's syndicate 1897, manages two RITC ('run-off') syndicates and owns and operates 4 MGAs;

- acquires and manages a portfolio of insurance receivables, with a carrying cost of c. £8.9m as at 30 June 2013;

The Group was founded by Ken Randall, Executive Chairman and Chief Executive, and Alan Quilter, Chief Operating Officer, who both have extensive experience in the industry including as Head of Regulation of Lloyd's and as Head of the Market Financial Services Group respectively.