Longhawk Insurance Group and PBS Holdings Merger

1st June 2009

Following discussions between the respective Boards we are pleased to announce the immediate merger of Longhawk Insurance Group (formerly UKU Ltd) and PBS Holdings Ltd (Primary General Insurance/Rural Insurance/Primary Claims).

Whilst the businesses have differing client and intermediary bases, the merger brings together two companies whose reputations have been built on innovation, customer service and flexibility. Both have focused on the provision of general insurance products to defined sectors and there are significant similarities in the business operating models of each. This will create a new organisation, which from day one will produce:

• Strong synergies of product and distribution capability
• An excellent opportunity to develop a streamlined support function for client facing teams
• A more substantial presence in the developing insurance market.

The new company will be led by a Board drawn from across both businesses, and complemented by additional independent, non-executive directors to be appointed shortly. It will also include a strong and experienced executive management team.

Tim Rolfe as Chief Executive will lead the newly combined business. Michael Warren will be Finance & Operations Director and Howard Posner will assume the position of Chairman.

It is intended that the new group will re-brand under a the new identity of UK General. Leeds will become the headquarters and operational centre supporting the regional locations that will continue with face-to-face support for our intermediaries and customers.

This is a very positive move for our business, our teams and our customers, expanding both our product range and distribution reach.