specialty reinsurer Stockton Reinsurance Ltd. has agreed in principle to buy one of the largest remaining independent managing agencies at Lloyd's.

Crowe Insurance Group Ltd. manages six syndicates with total premium income capacity for the 1999 year of account of more than 230 million.

Crowe is best known for its motor Syndicate 963, which currently writes over 150 million in commercial and specialist personal motor business inside and outside the UK.

Stockton Re president and CEO, Dan Malloy commented: "We look forward to working with Michael Crowe and his team and see the acquisition as an important element of our growth strategy -- it will bring us closer to markets in London, but will not compete with our existing brokered client base.

"We also believe that the Lloyd's capital structure offers considerable potential for expansion in alternative risk transfer -- not just for Crowe, but for its clients as well. We want to be in the forefront of those developments.'' The conditional agreement in principle is subject to due diligence, and detailed contractual agreements, including the formal agreement of certain shareholders, and regulatory approvals.

Robert Easton, chairman of Stockton Re's parent, Stockton Holdings Ltd., added: "Crowe is highly regarded at Lloyd's and it will continue to operate under its own name and current management team.

"We believe that Crowe is an attractive partner, not only because of the pedigree of its senior managers, but also because of the mix of its business and the quality of its risk controls. The Crowe acquisition will move us toward achieving our long-term strategic goals.'' Michael Crowe, chairman of the Crowe Insurance Group, said: "Stockton Re is an excellent partner for us.

"They are committed to investing to help serve our customers around the world while maintaining a respect for our management independence and for the way we do business. They are a dynamic company with recognised reinsurance and investment skills.

"Stockton Re's input will greatly benefit the Group's onward growth and profitability.'' Crowe's six syndicates specialise in aviation insurance and reinsurance, marine reinsurance, and UK liability and term life products, in addition to underwriting private and commercial motor risks.

As well as operating from nine offices in the UK, Crowe has overseas offices in Canada, Hong Kong, Italy and the Philippines. These facilities will be expanded in the future.

For 1999, Crowe's two corporate vehicles, Crowe Dedicated Limited and Crowe Corporate Capital Limited, will provide 170 million of underwriting capacity, representing over 70 percent of the Group's total managed capacity.

Stockton Reinsurance Ltd., an independent reinsurer, provides a wide variety of risk transfer coverages with a focus on customised finite reinsurance.

Stockton Re supports its underwriting activity with a diversified investment strategy, which is designed to generate long-term returns while containing downside volatility within acceptable parameters.

In August, 1998, Stockton Re received an initial rating of A- (Excellent) from A.M. Best. Stockton Re, which is privately-held, is headquartered in Hamilton, Bermuda with a representative office in London.

As of September 30, 1998, Stockton Re's assets were $1.8 billion and shareholders' equity was over $650 million.