Financial Security Assurance Holdings Announces Share Exchange Ratio For Capital Guaranty Shares In Pending Merger

Business Wire, Dec 14, 1995

NEW YORK--(BUSINESS WIRE)--Dec. 14, 1995--Financial Security Assurance Holdings Ltd. (FSA Holdings; NYSE: FSA), announced today that each common share of Capital Guaranty Corporation (Capital Guaranty; NYSE: CGY) will be exchanged for 0.6716 shares of FSA Holdings common stock and cash of $5.69 in consideration of the pending merger of Capital Guaranty with a subsidiary of FSA Holdings. FSA previously announced a December 20 date for a special meeting of shareholders to vote on the merger.

The exchange ratio is based on the average of the closing-sale price of FSA Holdings common stock on the NYSE for the 20 consecutive trading days immediately preceding the fifth trading day prior to the closing date of the merger, which is expected to be December 20.

FSA Holdings will issue 5,954,527 common shares in the aggregate. The aggregate cash consideration will be $50 million. The transaction has a value of approximately $200 million.

FSA Holdings' principal subsidiary Financial Security Assurance Inc. is an Aaa/AAA rated, monoline bond insurer that participates across all sectors of the municipal and asset-backed markets in the U.S. and international capital markets. Capital Guaranty's principal subsidiary, Capital Guaranty Insurance Company, which also is an Aaa/AAA rated monoline bond insurer, guarantees municipal bonds in the U.S.

Headquartered in New York, FSA has a London-based, U.K.-licensed subsidiary, Financial Security Assurance (U.K.) Limited, and representative offices in Paris, Madrid and Sydney.

CONTACT: Betsy Halpern

212/339-3424