Lightyear Capital LLC, a New York-based private equity firm, announced today that it has established a Bermuda-based holding company sponsoring a Lloyd's syndicate with $270 million in underwriting capacity.

The new entity, Antares Holdings Limited, will have businesses including the sponsorship of new Lloyd's of London syndicate Antares Syndicate 1274, which has purchased renewal rights from a German insurer for an undisclosed price.

Lightyear said Antares has obtained approval in principle from the Lloyd's Franchise Board to begin writing for the 2008 account year.

The company said the syndicate will have an underwriting capacity (gross written premium net of brokerage commission) of ?135 million (approximately $270 million).

The syndicate will be managed by Chaucer Syndicates Limited, a leading provider of third-party syndicate services, and capital for it will be provided by Lightyear and its partners.

Through an arrangement with German insurer W?rttembergische Versicherung AG, Antares will assume the renewal rights to the existing London market portfolio of W?rttVers and acquire its UK subsidiary, W?rttembergische UK Limited, Lightyear said.

The renewal rights pertain to an existing diversified specialty insurance portfolio with eight separate lines of business. The business will continue to be run by its current management, led by industry veteran Stephen D. Redmond.

Donald B. Marron, chairman and chief executive officer of Lightyear, said the transaction "exemplifies Lightyear's strategy of identifying high-quality, specialty financial services businesses run by talented and experienced management teams."

In reviewing financial services opportunities, Lightyear identified W?rttUK as "a solid business with significant potential. By repositioning it as a Lloyd's syndicate, the company is now poised for future success and well-positioned to become a recognized leader in its categories," Mr. Marron said.

"This is an exciting and innovative investment with the added benefit of extending our franchise experience in Europe," said Mark Vassallo, managing director of Lightyear.

Lloyd's, it was noted, is currently home to 68 syndicates providing ?16 billion (approximately $32 billion) in capacity for 2007.

"The Lloyd's platform is the optimal franchise for our clients and for the diversified portfolio of business to be underwritten by the Antares syndicate in 2008," said Mr. Redmond, the W?rttUK managing director, who will be chief executive officer of Antares.

Lightyear led the transaction and was joined by strategic equity partners including the specialist insurance and reinsurance group Chaucer Holdings PLC (LSE: CHU) and W?rttVers, and by private equity sponsors Hamilton Lane and Norwest Equity Partners.

David W. Glenn, Lightyear managing director, said: "We have worked hard to identify the right vehicle for a Lloyd's-based investment and have executed a complex transaction that required bringing together a range of qualified parties. We are pleased to have assembled the finest team of partners and co-investors for this transaction."

The transaction, which is expected to close in the fourth quarter of 2007, is subject to customary regulatory approval and other conditions. Lightyear received financial advice from Aon Capital Markets and legal counsel from Sullivan & Cromwell LLP and Clyde & Co.

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New Syndicate With $270 Million Capacity

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