ACE Ltd. and the "A'' (Excellent) ratings of Tempest Reinsurance Co. Ltd. and CAT Ltd., in the aftermath of the ACE deal that is to merge CAT and Tempest Re into a billion dollar property catastrophe reinsurer at Wessex House on Reid Street.

Subject to certain post closing transactions, ACE is buying CAT for about $711 million.

Best said, "Given ACE Ltd.'s focus on product and geographic diversification, management believes the acquisition is an excellent opportunity to enhance the group's strategic and financial objectives.

"A.M. Best views the transaction positively. Merging the two property catastrophe reinsurers -- CAT and Tempest -- will benefit both. The companies have complementary strengths, and there is little overlap between CAT's focus on regional accounts and Tempest's focus on national accounts with a greater diversification.

"The acquisition will position ACE, through Tempest, as one of the leaders in the property catastrophe market. It also will leave ACE with a stronger balance sheet, increase ACE's earning power and increase ACE's management and intellectual capital.

"ACE will use excess cash and short term debt facility to fund transaction, with the overall objective of financing the purchase with a 16.5 million share common stock offering.

"At closing, CAT's ownership interest in Enterprise Reinsurance will be distributed to CAT's shareholders, removing this ownership from the transaction.

"Following the completion of the transaction, the ACE group of companies will have total assets in excess of $7 billion.''