RNS Number:2878M
Benfield Group Limited
13 June 2003

Not for distribution in the United States, Canada, Australia or Japan

13 June 2003

                             BENFIELD GROUP LIMITED

                 ANNOUNCEMENT OF OFFER PRICE OF 250P PER SHARE

Benfield Group Limited ("Benfield"), the reinsurance broker, today announces an
offer price of 250p per share for its initial public offering; the indicative
price range for the Global Offer was 200p to 260p. At the offer price, the
company will have a market capitalisation of #575 million. The offer size was
#157 million and the gross aggregate demand received in the Global Offer was
approximately #1.7 billion.

John Coldman, Chairman of Benfield commented:

"We have had a very strong response to the Global Offer from major institutions
around the world. This is testament to the people who make Benfield the business
that it is today."

Grahame Chilton, Chief Executive of Benfield commented:

"I am delighted with the way new investors have embraced the Benfield story. It
is a tremendous endorsement of Benfield's business and we look forward to
working for all shareholders in developing additional value from our global
platform. We are now well positioned to move forward with our aim of delivering
sustainable revenue growth and margin expansion."

CONFERENCE CALL AND PRESS CONFERENCE

There will be a wire service conference call at 7.15am today. Journalists
wishing to participate are asked to call Zoe Pocock or Nicola Labram at Haggie
Financial on 020 7417 8989 to obtain dial-in details.

There will also be a press conference at 11.30am today on the 23rd Floor of the
London Stock Exchange, Old Broad Street, London EC2N 1HP. Journalists wishing to
attend are asked to call Laura Scott or Nicola Labram at Haggie Financial on 020
7417 8989 or email: laura.scott@haggie.co.uk

ADDITIONAL INFORMATION

The Global Offer comprises the issue of 40,000,000 new common shares by the
Company, and the sale of 22,786,590 existing common shares. These existing
shares are being sold to facilitate the cashless exercise of options and the
repayment of loan facilities by employees and as part of a limited secondary
sale facility.

The number of shares in issue at listing (prior to any exercise of the
over-allotment option) will be 229,898,680. In total, 62,786,590 common shares
have been allocated to institutions under the Global Offer, representing 27.3%
of the issued share capital of Benfield and an offer size of #157.0 million.

The net proceeds to the Company of #98.8 million from the Global Offer, exercise
of options and paying up of partly-paid shares will be used to repay existing
indebtedness.

In addition, Benfield has granted Merrill Lynch International, as stabilisation
manager, an over-allotment option for 30 days to purchase up to a further
9,417,988 new ordinary shares to meet over-allotments, if any, in connection
with the Global Offer.

No directors will receive any cash proceeds from the sale of existing shares in
the Global Offer.

Existing shareholders are subject to lock-ups of various periods following
admission.

The shares will be listed on the London Stock Exchange under the symbol BFD.
Conditional dealings are expected to commence at 8.00am on 13 June 2003.
Admission to the Official List of the UK Listing Authority and commencement of
unconditional dealings on the London Stock Exchange are expected to take place
at 8.00am on 18 June 2003.


Merrill Lynch International and Morgan Stanley acted as joint bookrunners for
the Global Offer and joint financial advisers to Benfield. Merrill Lynch
International also acted as Sponsor and Broker to Benfield. Co-lead managers for
the Global Offer are Fox-Pitt, Kelton and Deutsche Bank. Lexicon Partners also
acted as joint financial adviser to Benfield.


ENQUIRIES

Benfield
David Bogg (Media)                           +44 20 7522 4016
Julianne Jessup (Investors)                  +44 20 7578 7425

Merrill Lynch International                  +44 20 7628 1000
Rupert Hume-Kendall                          Simon Fraser

Morgan Stanley                               +44 20 7425 8000
John Crompton                                John Porter

Lexicon Partners                             +44 20 7743 6330
Andrew Sibbald

Haggie Financial                             +44 20 7417 8989
David Haggie                                 Peter Rigby

Financial Dynamics                           +44 20 7831 3113
Alex Child-Villiers                          Rob Bailhache




NOTES FOR EDITORS


Benfield Summary

  * Major global reinsurance broker
  * 2002 revenues #291million
  * Ranked third largest reinsurance broker by 2001 revenues
  * One of four major global reinsurance intermediaries
  * Largest independent reinsurance intermediary

  * Leading presence in main reinsurance markets of US, UK, Bermuda and
    Pacific Rim
  * More than 1,000 customers in over 90 countries
  * 37 offices in 23 countries
  * Corporate Headquarters in UK, incorporated in Bermuda

Background to reinsurance broking

Benfield acts as an intermediary, placing reinsurance on behalf of insurers and
reinsurers. Benfield is not a reinsurer and is not exposed to any underwriting
risk on the reinsurance contracts that are placed.

The services provided by a reinsurance broker include:

  * assisting clients in their analysis of risk
  * structuring a reinsurance programme to meet these requirements
  * placing the risk on behalf of the risk carrier with appropriate reinsurers
  * negotiating reinsurance policy terms and conditions

The sources of income for a reinsurance broker comprise:

  * commission and fees generated on reinsurance placements
  * fees generated from consultancy and other related services including risk
    and catastrophe modelling
  * interest income earned on premium flows

Introduction

Benfield is one of the largest reinsurance intermediaries in the world.  It has
achieved this position through a combination of organic growth and the
successful completion of a number of strategic transactions.  The Group provides
reinsurance intermediary and risk advisory services to more than 1,000 customers
located in over 90 different countries.

The Group is headquartered in London and incorporated in Bermuda.  It has an
international network of 37 offices located in 23 countries and a leading
presence in many of the major markets for reinsurance products including the
United States, the United Kingdom, Continental Europe, Bermuda and the Pacific
Rim.

As a reinsurance intermediary, Benfield specialises in structuring, arranging
and placing reinsurance programmes on behalf of insurance and reinsurance
companies.  The Group does not underwrite risks for its own account.

The combination of Benfield's global presence, technical expertise and
proprietary technology allows the Group to offer innovative solutions to its
customers worldwide.  The majority of the Group's customers are insurance and
reinsurance companies.

The Group has experienced excellent customer retention with the top 10 customer
relationships having been in place for an average of 24 years.  This provides a
stable platform with existing customers of the Group accounting for
approximately 85 per cent of 2002 turnover.

The Group has a highly experienced executive management team which has an
average of over 20 years service in the industry. In addition, Benfield employs
skilled and experienced individuals, with senior brokers having an average of
over 9 years of service with the Group.

For the year ended 31 December 2002 the Group reported operating revenue of #291
million and a trading result (operating profit before amortisation of goodwill,
depreciation of tangible fixed assets and exceptional costs) of #69 million.

History of the Group

The origins of Benfield date back to the 1970s with the establishment of
Benfield Lovick & Rees, a London based reinsurance broker.  In 1988, this
business was acquired by its management team which included John Coldman and
Grahame Chilton, the current Chairman and Chief Executive of Benfield
respectively.  Subsequently, the Group successfully acquired and integrated a
number of reinsurance intermediary businesses, such as Ellinger Heath Western in
1995, Greig Fester in 1997, Bates Turner in 1999 and Blanch in 2001.

Business strategy

The Group's primary objective is to be the reinsurance intermediary of choice in
the key markets in which it operates.  By focusing on enhancing its existing
customer relationships and using its competitive strengths to win new customers
and business, Benfield intends to deliver sustainable growth in revenue, cash
flows and earnings.

The Directors believe that the Group is well positioned to take advantage of the
increasing demand for reinsurance intermediaries by enhancing customer
relationships, capitalising on its competitive strengths, managing operating
costs and retaining, recruiting and incentivising high quality people.

Key elements of the strategy include:

Capitalising on competitive strengths

The Directors believe Benfield can build on its competitive strengths to win new
customers, especially from growth opportunities in several geographic markets
and from product development.

These opportunities include the following:

  * building further on the Group's relatively low market share in the United
    States

  * benefiting from the prospect of increased use of reinsurance
    intermediaries in Continental Europe

  * capitalising on the Group's market penetration in Eastern Europe

  * benefiting from deregulation and market growth in the Pacific Rim

  * capitalising on the Group's sophisticated risk transfer capabilities

  * expansion of the casualty operations in the Group's International division


The Group intends to build further on its global presence and reputation by
focusing on large, multinational customers with complex risk profiles, who
demand innovative solutions. In addition, the Group will continue to focus on
value-added higher margin business, such as excess of loss catastrophe cover,
which represents a substantial proportion of the Group's revenue.

Managing operating costs

The Directors believe that Benfield can sustain profitable growth by leveraging
the existing platform to generate increased revenue whilst maintaining a
relatively flat cost base.

The Group has implemented the following initiatives in order to manage costs and
improve margins:

  * controlling headcount, undertaking a limited redundancy programme,
    rationalising office space, implementing a programme of central purchasing
    and applying a Group-wide unified expense policy

  * rationalisation of those areas that the Directors do not believe will be
    capable of meeting the Group's long-term margin and growth objectives

  * enhanced forecasting and budgeting procedures, which have set clear
    divisional targets and have improved the reliability of revenue and cost
    forecasts


The Directors believe that these actions should allow the Group to deliver
margin improvement whilst maintaining sustainable revenue growth.

Retaining, recruiting and incentivising high quality people

The Group's continuing success depends on the quality of its employees.
Benfield aims to attract and retain the most talented people by offering
attractive performance-based compensation packages, the maintenance and
development of bespoke in-house training programmes and by encouraging a high
level of employee share ownership.  Share awards have been and will continue to
be used to incentivise key employees.

This announcement does not constitute or form part of an offer, or solicitation
of an offer to purchase or subscribe for any Benfield Group Limited shares.
Prices and values of, and income from, shares may go down as well as up. Past
performance is no guide to future performance and persons needing advice should
consult an independent financial adviser. Stabilisation/FSA.

This announcement is not for publication, distribution or release in the United
States, Canada, Australia or Japan. This announcement does not constitute or
form part of an offer or solicitation of an offer to purchase or subscribe for
securities in the United States, Canada, Australia or Japan.

Shares in Benfield Group Limited have not been and will not be registered under
the US Securities Act of 1933 as amended and have not and will not be offered or
sold in the United States absent registration or an exemption from registration.
No public offering of securities is being made in the United States.

The contents of this announcement, which has been prepared by and is the sole
responsibility of Benfield Group Limited, has been approved by Merrill Lynch
International, Morgan Stanley Securities Limited and Lexicon Partners Limited
solely for the purposes of section 21 of the Financial Services and Markets Act
2000. Merrill Lynch International, Morgan Stanley Securities Limited and Lexicon
Partners Limited can be contacted as stated above.

Merrill Lynch International and Morgan Stanley Securities Limited are the Joint
Bookrunners for the Global Offer. Merrill Lynch International is Sole Sponsor
and Broker to Benfield Group Limited. Merrill Lynch International, Morgan
Stanley Securities Limited and Lexicon Partners Limited are acting for Benfield
Group Limited in relation to the Global Offer and no one else and will not be
responsible to anyone other than Benfield Group Limited for providing the
protections afforded to their respective clients, nor for providing any advice
in relation to the Global Offer, the contents of this document or any
transaction or arrangement referred to herein.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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