Alexander Forbes International Risk Services Completes Transaction to Create Largest Private Insurance Broker

Business Wire, August 21, 2006

LONDON -- Alexander Forbes International Risk Services (AFIRS), the international insurance and risk management arm of Alexander Forbes Limited, today announced that they would be acquired by Lockton, Inc., creating the largest independent and privately owned global insurance broker with revenues in excess of $600m. When combined with AFIRS' position in the European broker partnership, EOS RISQ, it creates an organisation with local representation in 43 countries.

The transaction is expected to be completed by the end of October 2006 and is subject to regulatory approval.

Lockton is one of the most respected and experienced insurance brokerage firms in the U.S., generating 19% organic growth in its FYE 2005 -2006 and client retention rates above 95%. The new company - Lockton International Holdings Limited - will operate under the name of Lockton and remain based in London. Lockton International Holdings Limited will be a separate entity in the Lockton Group.

Mike Hammond, Deputy Chairman of AFIRS will become Executive Chairman of Lockton International Holdings. "This is a landmark deal," he said. "We are building a great company that will attract and retain the best people in the industry and create a powerful independent alternative for buyers when choosing their worldwide insurance partner."

Stewart McCulloch, CEO of AFIRS will become chief executive of Lockton International Holdings. "Lockton has been a valued business partner of ours for more than a decade so we go into this new enterprise with the greatest of confidence. The operations of our two businesses complement each other, both in terms of geographical presence and the skills that we all bring to the table."

"We know this company very well. For the past decade, our teams have worked side-by-side to provide international insurance and risk management solutions to most of Lockton's U.S.-based clients," said David M. Lockton, Chairman of Lockton, Inc. "Lockton's unique private ownership has provided superior levels of service to clients for the past 40 years. This is the perfect opportunity to expand globally."

John Percy-Davis, currently executive chairman of AFIRS, will continue to work closely with Mike Hammond, Stewart McCulloch and the Executive team. He will remain Chairman of EOS RISQ.

John Lumelleau, Chief Executive Officer of Lockton, Inc, added, "Alexander Forbes has an impressive global platform and expertise. This provides Lockton with the ability to serve our clients with an even broader array of global risk management expertise with local insight and services."

Lockton will have majority ownership in Lockton International Holdings with minority investment from management and Trident III, L.P., an investment fund managed by Stone Point Capital, LLC of Greenwich, CT.

"We value the Stone Point participation in this acquisition, and look forward to working with them in growing our international business," said David Lockton. "We nonetheless are fiercely committed to our independence because it allows us to make long-term investments in our people and our company, so we can offer superior service to our clients." Lockton will remain a privately held firm owned by the Lockton family and key executives.

Notes to editors

Alexander Forbes International operations include Risk Services and Financial Services divisions. This transaction relates only to the International Risk Services division. Its UK insurance business (Alexander Forbes Risk Services Limited trading as Alexander Forbes International Risk Services) provides insurance and reinsurance broking, risk and insurance programme management and consulting, alternative risk finance, claims management and insurance products and services. Alexander Forbes Risk Services Limited is authorised and regulated by the Financial Services Authority. The International Risk Services division also has operations in Mexico, Brazil and throughout Asia.

Alexander Forbes International Financial Services businesses include retirement fund administration, employee benefit consulting, software development, actuarial and related services, personal financial planning, direct marketing of financial products and multi-manager investment solutions and personal finance planning. None of these Financial Services operations are involved in this transaction.

For more information on Alexander Forbes and its insurance, risk and financial services, please visit the website at www.alexanderforbes.co.uk

The 2,100 risk experts at the Lockton Companies provide more than 15,000 clients across the U.S. with insurance, surety and risk management services, offering an uncommon level of client service. From a modest, home-based insurance agency, Lockton Companies has become one of the largest insurance brokers in the world. It was founded by Jack Lockton in Kansas City, Missouri, USA, in 1966. It is the largest independently owned insurance broker in the U.S. and the 11th largest broker in the country. You can learn more at www.lockton.com.

Stone Point Capital LLC is a global private equity firm based in Greenwich, Connecticut. Stone Point Capital serves as the manager of the Trident Funds, which have raised more than $3 billion in committed capital to make investments in the insurance, employee benefits and financial services industries.