quarter incurred losses of $25 million as a result of Hurricane Georges and other events.

PartnerRe president and CEO Herbert Haag made note of the claims activity this weekend as he announced significant progress in the firm's planned acquisition of certain portions of Winterthur Insurance.

The Bermuda reinsurer is preparing its financial statement for the third quarter to September 30.

Mr. Haag stated: "This quarter will include the severe Hurricane Georges that devastated several Caribbean Islands and the southern coastline of the United States between September 15 and 29, 1998.

"We currently estimate that claims activity from this hurricane, along with certain other large loss events, is expected to increase incurred losses in this quarter by approximately $25 million.'' PartnerRe has signed a definitive asset purchase agreement with Winterthur Insurance, under which PartnerRe acquires Winterthur Re's Swiss operation.

PartnerRe also entered into a reinsurance agreement, transferring the Swiss life and non-life portfolios, including the current business and reserves of approximately $1.5 billion, to the Bermuda operating company, Partner Reinsurance Co. Ltd.

The purchase agreement will soon be executed for the life and non-life US operations.

The aggregate purchase price for both the Swiss operations and the US operations is expected to be approximately $780 million -- some $30 million higher than was first announced when the deal was made public at the end of August.

It will be paid for with $560 million of funds from internal sources and $220 million of external debt.

The transaction will be accounted for as a purchase. Goodwill is expected to be approximately $350 million. PartnerRe anticipates this transaction to be non-dilutive in 1998 and beyond.

PartnerRe has started the integration process of the Swiss operations by initiating the formation of a branch in Winterthur, Switzerland.

This branch formation is expected to be completed before the end of the month.

The 180 employees of Winterthur Re in Switzerland will transfer to the newly formed branch at the start of the new year.

Mr. Haag commented: "We are very pleased that we have smoothly finalised the terms for the transfer of the Swiss operations.

"My experience in this process has affirmed my belief in the high level of expertise in Winterthur Re's organisation and their conservative reserving philosophy.

"Winterthur Re's specialty emphasis and profit-oriented underwriting approach will prove a perfect fit with the existing culture of PartnerRe. "Not only will we achieve a significant strengthening of our global presence and capabilities, but this transaction also allows us to immediately enhance capital utilisation and a further diversification of risks. "The benefits of the combined operation for clients and shareholders alike will prove a differentiating factor in today's competitive reinsurance environment.'' He continued: "We are now working diligently to complete the US portion of this transaction and are not anticipating any difficulties in that regard.

"Due, however, to the customary regulatory approvals, we do not expect to close the entire transaction until sometime in December.''