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Sale of Praetorian Group to Australian insurer completed

Hannover, 1 June 2007:

The sale of Hannover Re's US subsidiary Praetorian Financial Group, Inc., New York, to the Australian QBE Insurance Group Ltd., Sydney – which had been agreed in December 2006 – was closed effective 31 May 2007 upon receipt of the required approval from regulators.

QBE's US subsidiary has acquired all shares of Praetorian. The purchase price of sightly in excess of USD 800 million is equivalent to 2.1 times Praetorian shareholders' equity excluding goodwill as at year-end 2006.

"Following the successful closing of this transaction we shall concentrate on our core business of reinsurance going forward", Wilhelm Zeller, Hannover Re’s Chief Executive Officer, affirmed.
" As we have already indicated, the risk capital that has been freed up is to be profitably invested in both non-life and life/health reinsurance business. This will enable us to more than offset the loss of Praetorian's profit contribution." Mr. Zeller added, “We appreciate the combined efforts of Praetorian’s employees and their trading partners, all of which contributed to a successful transaction close."

Hannover Re can tap into profitable growth opportunities in a number of areas, including for example by raising its retention in the still lucrative property catastrophe segment, by writing additional US catastrophe business, and also by cultivating new markets – such as in Central and Eastern Europe and in the Islamic world. As a further step, Hannover Re increased its stake in its profitable subsidiary E+S Rück by 10% to 65.8% effective 1 April 2007. Last but not least, acquisitions in life and health reinsurance remain a possibility insofar as they make strategic and economic sense.