The latest industry consolidation has Bermuda-based property catastrophe reinsurer, PartnerRe Ltd., buying the active reinsurance arm of Winterthur Insurance Co. for $750 million in cash from the Credit Suisse Group (CS).

Winterthur's decision to focus on its core direct insurance business led to the opportunity for the PartnerRe purchase.

CS bought Winterthur for $10 billion in shares last year, and is now reshuffling the insurer's portfolio to focus on its most profitable units, Bloomberg reported.

As part of that reorganisation, Winterthur sold its Australian arm last month.

"Winterthur has taken a second important step towards concentrating on its core activities by selling its active reinsurance operations,'' CS said in a statement, adding that it would invest the proceeds to expand its primary insurance business in Europe and Asia.

President and Chief Executive Officer of PartnerRe Herbert N. Haag stated: "The acquisition of Winterthur Re is an ideal opportunity to enhance PartnerRe's long-term competitive position and shareholder value.

"Winterthur Re operates a highly successful and profitable business and brings excellent capabilities, both in terms of underwriting skills and client contacts.

"Its specialty orientation in the non-life and life business ideally complements our underwriting teams and book of business -- both geographically and in highly specialised areas such as agricultural risks, credit/surety, engineering, aviation and marine, where Winterthur Re is recognised as maintaining leading market positions.

"This expanded breadth of capabilities substantially enhances PartnerRe's position globally while, in the United States, the transaction advances our strategy by providing a solid platform of underwriting capabilities, infrastructure and market presence.

"This is consistent with our objective to be the new choice in global reinsurance.'' Mr. Haag, continued: "I have known Winterthur Re's executives for many years and I am extremely pleased that they will be part of our organisation. They bring with them a professional, highly skilled and dedicated team that will further strengthen our group's resources.

"Importantly, PartnerRe and Winterthur share common business values and I also look forward to building an ongoing business relationship between the new PartnerRe Group and Winterthur Insurance.'' Last year, Winterthur Re accounted for about 4.7 percent of Winterthur's total premium income, generating 1.26 billion francs in premiums. The unit focuses on aviation as well as credit and surety reinsurance, which will complement Partner Re's property reinsurance. PartnerRe said last month it plans to expand further in reinsurance.

PartnerRe and Winterthur Insurance have entered into an exclusivity agreement to allow the two parties to reach a definitive agreement.

PartnerRe buys Winterthur reinsurance arm from CS The Boards of PartnerRe and Winterthur Insurance have approved the proposed transaction, which is expected to close during the fourth quarter 1998.

The transaction is contingent upon the execution of a definitive purchase agreement and is subject to customary regulatory approvals.

PartnerRe intends to release additional information once the purchase agreement has been signed, which is expected before October 1, 1998.

Winterthur Re's operations are based in Switzerland, the United States, Canada and Singapore and include the legal entities Winterthur Reinsurance Corporation of America, New York, and Winterthur Re Life Insurance Company, Dallas.

The combined global gross premiums produced in 1997 were $837 million, of which non-life premiums were $582 million and life premiums $255 million (of which 75% is annuity business).

Total assets exceed $3 billion. The distribution of Winterthur Re's premiums by business lines is Life/Annuity/Health 30%, Property 23%, Motor/Casualty 15%, Credit/Surety 12%, Aviation 9%, Agro risks 4%, Others 7%, of which 57% originated from the Americas, 35% from Europe and 8% from Asia.

This is highly complementary to PartnerRe Group's current business mix and strategic objectives.

PartnerRe Ltd. provides multi-line reinsurance to insurance companies on a worldwide basis through its wholly owned subsidiaries, Partner Reinsurance Company Ltd. in Bermuda, SAFR in Paris and PartnerRe US in New York.

Risks reinsured include catastrophe, property, automobile, marine, space and aviation, credit/surety, miscellaneous casualty lines and life/health.