Recommended cash offer

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

FOR IMMEDIATE RELEASE

26 October 2010

RECOMMENDED CASH OFFER FOR BRIT INSURANCE HOLDINGS N.V.

("BRIT INSURANCE")

BY ACHILLES NETHERLANDS HOLDINGS B.V. ("ACHILLES")

Summary

·; The board of Achilles and the Independent Directors of Brit Insurance are pleased to announce that they have agreed the terms of a recommended cash offer to be made by Achilles for Brit Insurance.

·; Achilles is a newly-incorporated company formed on behalf of, and which will be majority-owned by, funds managed by Apollo Management VII, L.P. and funds advised by CVC Capital Partners Limited.

·; Under the terms of the Proposal, which comprises the Offer and the £0.30 Capital Distribution, Entitled Brit Shareholders who accept the Offer will be eligible to receive up to £11.00 in cash per Brit Share.

·; Under the terms of the Offer, all accepting Brit Shareholders will be entitled to receive £10.45 in cash plus a Contingent Value Payment ("CVP") of up to £0.25 in cash per Brit Share. In addition, Entitled Brit Shareholders, being Brit Shareholders who were on the register of Brit Insurance on 22 October 2010 will remain eligible to receive the £0.30 Capital Distribution payable in cash on 7 December 2010.

·; The amount of the CVP will be calculated by reference to the extent to which Brit Insurance's audited consolidated net tangible asset value as at 31 December 2010 per Brit Share (on a diluted basis) after adjustment for certain agreed items exceeds £10.75. 

·; If the maximum CVP of £0.25 per Brit Share were payable, the entitlement to receive £10.45, the full CVP and the £0.30 Capital Distribution, in each case, in cash per Brit Share, would value the entire issued and to be issued share capital at approximately £888 million.

·; The aggregate amount payable under the Proposal of £10.75 to £11.00 per Brit Share represents a premium of between approximately:

o 47 per cent. to 51 per cent. to the Closing Price of £7.29 per Brit Share on 10 June 2010 (being the last Business Day prior to the commencement of the Offer Period); and

o 40 per cent. to 44 per cent. to the average Closing Price of £7.66 per Brit Share for the six month period ended 10 June 2010 (being the last Business Day prior to the commencement of the Offer Period).

·; The Offer is subject to the terms and conditions in Appendix 1 which include (i) acceptances of the Offer being received in respect of Brit Shares representing at least 95 per cent. (or such lower percentage as Achilles may decide) of the Diluted Share Capital; (ii) the Independent Shareholders passing the Resolution to approve the Management Arrangements; (iii) approvals and consents received from the FSA, Lloyd's and the Gibraltar Financial Services Commission; and (iv) the satisfaction of all merger control requirements under the laws of the European Union, the United States and certain other applicable jurisdictions, together with other customary conditions.

·; Lexicon Partners is acting as the independent financial adviser to the Independent Directors of Brit Insurance in connection with the Offer under Rule 3 of the Takeover Code. The Independent Directors, who have been so advised by Lexicon Partners, consider the Offer to be fair and reasonable and intend unanimously to recommend that Brit Shareholders accept the Offer and vote in favour of the Resolutions at the Brit General Meeting. In providing its advice to the Independent Directors, Lexicon Partners has taken into account the Independent Directors' commercial assessments.

·; Achilles has received irrevocable undertakings from certain Independent Directors and all of the Managers to accept the Offer in respect of 423,117 Brit Shares in aggregate (representing approximately 0.53 per cent. of the existing issued ordinary share capital of Brit Insurance) and from certain Independent Directors and Managers to accept the Offer or the proposals to be made by Achilles to holders of options and awards over up to 970,461 Brit Shares in aggregate representing approximately 1.23 per cent. of the existing issued share capital of Brit Insurance (together with the Brit Shares referred to above, representing approximately 1.76 per cent. of the existing issued share capital of Brit Insurance).

Advisers

Brit Insurance is receiving financial advice from Lexicon Partners and J.P. Morgan Cazenove. Achilles is receiving financial advice from BofA Merrill Lynch, Willis Capital Markets & Advisory, Citi and West Hill Corporate Finance.

Commenting on the Offer, John Barton, the Chairman of Brit Insurance said:

"I am pleased that we have reached agreement on the terms of the Offer which values Brit Insurance's shares at a significant premium to the prevailing market price prior to the commencement of the Offer Period. Having given full consideration to the Offer from Achilles, the Independent Directors believe it represents good value for Brit Shareholders and recommend that they accept the Offer."

Enquiries

This summary should be read in conjunction with, and is subject to, the full text of this announcement, including the Appendices.

The conditions to, and certain further terms of, the Offer are set out in Appendix 1. The bases and sources for certain financial information contained in this announcement are set out in Appendix 2. Details of irrevocable undertakings received by Achilles are set out in Appendix 3. Certain definitions and terms used in this announcement are set out in Appendix 4.

Merrill Lynch International (BofA Merrill Lynch) a subsidiary of Bank of America Corporation, Willis Capital Markets & Advisory, Citigroup Global Markets Limited and West Hill Corporate Finance are acting exclusively for Achilles and no one else in connection with the Offer and this announcement and will not be responsible to anyone other than Achilles for providing the protections afforded to their clients or for providing advice in connection with the Offer or any matter referred to herein.

Lexicon Partners and J.P. Morgan Cazenove are acting exclusively for Brit Insurance and no one else in connection with the Offer and this announcement and will not be responsible to anyone other than Brit Insurance for providing the protections afforded to their clients or for providing advice in connection with the Offer or any matter referred to herein.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities, pursuant to the Offer or otherwise. The Offer will be made solely by the Offer Document, when issued, which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. Any acceptance or other response to the Offer should be made on the basis of the information in the Offer Document.

In accordance with Rule 2.10 of the UK Takeover Code, the current issued share capital of Brit Insurance comprises 79,162,725 ordinary shares of €3.64 each. The ISIN for those securities is NL0009347863.

Overseas jurisdictions

This announcement has been prepared for the purpose of complying with English and Dutch law and the information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside the United Kingdom and the Netherlands.

The Offer will be subject to the applicable rules and regulations of the UKLA, the London Stock Exchange, the UK Takeover Panel, the Dutch decree on public offers (Besluit openbare biedingen), the Dutch Financial Supervision Act (Wet op het financieel toezicht) and the Dutch Civil Code (Burgerlijk Wetboek).

The release, publication or distribution of this announcement in certain jurisdictions may be affected by the laws of relevant jurisdictions. Persons who are subject to the laws of any jurisdiction other than the United Kingdom or the Netherlands or are not resident in the United Kingdom or the Netherlands will need to inform themselves about, and observe, any applicable requirements.

Unless otherwise determined by Achilles or required by the UK Takeover Code and permitted by applicable law and regulation, the Offer will not be made, directly or indirectly, in or into or by the use of the mails of, or by any other means or instrumentality (including, without limitation, electronic mail, facsimile transmission, telex, telephone, internet or other forms of electronic communication) of interstate or foreign commerce of, or any facility of a national state or other securities exchange of any Restricted Jurisdiction and will not be capable of acceptance by any such use, means, instrumentality or facility or from within any Restricted Jurisdiction.

Accordingly, unless otherwise determined by Achilles or required by the UK Takeover Code and permitted by applicable law and regulation, copies of this announcement and any documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed, transmitted or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction and persons receiving this announcement (including, without limitation, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in, into or from any Restricted Jurisdiction, as doing so may invalidate any purported acceptance of the Offer. Any person (including, without limitation, custodians, nominees and trustees) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement and/or the Offer Document and/or any other related document to any jurisdiction outside the United Kingdom or the Netherlands should inform themselves of, and observe, any applicable legal or regulatory requirements of any relevant jurisdiction.

Notice to US investors

The Offer is for the securities of a corporation organised under the laws of the Netherlands and is subject to the procedure and disclosure requirements of the United Kingdom, which are different from those of the United States. The Offer is being made in the United States pursuant to Section 14(e) of, and Regulation 14E under, the US Securities Exchange Act of 1934, as amended (the "Exchange Act"), subject to the exemptions provided by Rule 14d-1(d) under the Exchange Act and otherwise in accordance with the requirements of the Takeover Code. Accordingly, the Offer is subject to disclosure and other procedural requirements, including with respect to withdrawal rights, the offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and laws.

To the extent permitted by applicable law, in accordance with, and to the extent permitted by, the Takeover Code and normal UK market practice and Rule 14e-5 under the Exchange Act, Achilles or its nominees or brokers (acting as agents) or their respective affiliates may from time to time make certain purchases of, or arrangements to purchase, Brit Shares, other than pursuant to the Offer, before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Such purchases, or arrangements to purchase, will comply with all applicable UK rules, including the Takeover Code and the rules of the London Stock Exchange, and Rule 14e-5 under the US Exchange Act to the extent applicable. In addition, in accordance with, and to the extent permitted by, the Takeover Code, normal UK market practice and Rule 14e-5 under the Exchange Act, BofA Merrill Lynch and Citi and their respective affiliates will continue to act as exempt principal traders in Brit Shares on the London Stock Exchange and engage in certain other purchasing activities consistent with their respective normal and usual practice and applicable law, including Rule 14e-5 under the Exchange Act. Any information about such purchases will be disclosed on a next day basis to the Panel and will be available from any Regulatory Information Service including the Regulatory News Service on the London Stock Exchange website, www.londonstockexchange.com. To the extent that such information is made public in the United Kingdom, this information will also be publicly disclosed in the United States.

Each US shareholder of Brit Shares is urged to consult with his independent professional adviser regarding any acceptance of the Offer.

This announcement does not constitute an offer of securities for sale in the United States or an offer to acquire or exchange securities in the United States. No offer to acquire securities or to exchange securities for other securities has been made, or will be made, directly or indirectly, in or into, or by use of the mails, any means or instrumentality of interstate or foreign commerce or any facilities of a national securities exchange of, the United States or any other country in which such offer may not be made other than (i) in accordance with the tender offer requirements under the Exchange Act or the securities laws of such other country, as the case may be, or (ii) pursuant to an available exemption from such requirements. Neither the US Securities and Exchange Commission (the "SEC") nor any US state securities commission has approved or disapproved this Offer or passed upon the adequacy or completeness of this document or the Offer Document. Any representation to the contrary is a criminal offence.

It may be difficult for US holders of Brit Insurance securities to enforce their rights and any claim arising out of the US federal securities laws, since Achilles and Brit Insurance are located outside of the United States, and some or all of their officers and directors may be resident outside of the United States. US holders of Brit Insurance securities may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the US securities laws. Further, it may be difficult to compel a foreign company and its affiliates to subject themselves to a US court's judgment.

Forward-looking statements

This announcement, including information included or incorporated by reference in this announcement, may contain "forward-looking statements" concerning the Consortium, Achilles and Brit Insurance. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward‑looking statements. The forward‑looking statements involve risks and uncertainties that could cause actual results to differ materially from those suggested by them. Many of these risks and uncertainties relate to factors that are beyond the abilities of the Consortium, Achilles and Brit Insurance to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this announcement. The Consortium, Achilles and Brit Insurance assume no obligation and do not intend to update these forward‑looking statements, except as required pursuant to applicable law.

Disclosure requirements of the UK Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Publication on website

In accordance with Rule 19.11 of the Takeover Code, a copy of this announcement will be available at http://investor.britinsurance.comby no later than 12 noon on 27 October 2010.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

FOR IMMEDIATE RELEASE

26 October 2010

RECOMMENDED CASH OFFER FOR BRIT INSURANCE HOLDINGS N.V. ("BRIT INSURANCE") BY ACHILLES NETHERLANDS HOLDINGS B.V. ("ACHILLES")

1. Introduction

The board of Achilles and the Independent Directors of Brit Insurance are pleased to announce that they have agreed the terms of a recommended cash offer to be made by Achilles for the issued and to be issued share capital of Brit Insurance.

Achilles is a newly-incorporated company formed on behalf of, and which will be majority-owned by, funds managed by Apollo Management VII, L.P. and funds advised by CVC Capital Partners Limited.

2. The Proposal

Under the terms of the Proposal, which comprises the Offer and the £0.30 Capital Distribution, Entitled Brit Shareholders who accept the Offer will be eligible to receive up to £11.00 in cash per Brit Share.

The Offer, which will be subject to the Conditions and further terms set out below and in Appendix 1 (and the full terms and conditions which will be set out in the Offer Document and the Form of Acceptance), will be made to Brit Shareholders on the following basis:

In addition, Entitled Brit Shareholders will remain eligible to receive the £0.30 Capital Distribution payable in cash.

If the maximum CVP of £0.25 per Brit Share were payable, the entitlement to receive £10.45, the full CVP and the £0.30 Capital Distribution, in each case in cash per Brit Share, would value the entire issued and to be issued share capital at approximately £888 million.

Details of the CVP are set out in paragraph 3 below.

The aggregate amount payable under the Proposal of £10.75 to £11.00 per Brit Share represents a premium of between approximately:

o 47 per cent. to 51 per cent. to the Closing Price of £7.29 per Brit Share on 10 June 2010 (being the last Business Day prior to the commencement of the Offer Period); and

o 40 per cent. to 44 per cent. to the average Closing Price of £7.66 per Brit Share for the six month period ended 10 June 2010 (being the last Business Day prior to the commencement of the Offer Period).

Entitled Brit Shareholders who were on the register of Brit Insurance on 22 October 2010 will remain eligible to receive the £0.30 Capital Distribution payable in cash on 7 December 2010.

The Conditions to the Offer are set out in full in Appendix 1 and include: (i) acceptances of the Offer being received in respect of Brit Shares representing at least 95 per cent. (or such lower percentage as Achilles may decide) of the Diluted Share Capital (ii) the Independent Shareholders passing the Resolution to approve the Management Arrangements; (iii) approvals and consents received from the FSA, Lloyd's and the Gibraltar Financial Services Commission; and (iv) the satisfaction of all merger control requirements under the laws of the European Union, the United States and certain other applicable jurisdictions, together with other customary conditions.

The Conditions are expected to be satisfied and it is expected that the Offer should be declared unconditional in all respects in the first quarter of 2011. However, this proposed timetable is subject to change, and the parties have agreed to seek Panel consent for any extension to the timetable if necessary to obtain regulatory consents.

Under the Implementation Agreement, Achilles has agreed not to cause the Offer to lapse before Day 60 by reference to any non-fulfilment of the Acceptance Condition except in specified circumstances including the announcement of a competing offer, certain breaches by Brit Insurance of its covenants in the Implementation Agreement or the withdrawal, modification or qualification of any of the recommendations of the Independent Directors to Brit Shareholders referred to in this announcement.

3. The Contingent Value Payment

The Contingent Value Payment of up to £0.25 in cash per Brit Share will become payable to accepting Brit Shareholders if Brit Insurance's audited consolidated net tangible asset value as at 31 December 2010, after adjustment for certain agreed items, is greater than £10.75 per Brit Share (using the Fully Diluted Share Capital, as determined on the CVP calculation date).

The full £0.25 per Brit Share will become payable if the Pro-forma 2010 Year End NTAV Per Share is equal to or greater than £11.00. The amount payable reduces on a linear sliding scale to the extent that the Pro-forma 2010 Year End NTAV Per Share is between £11.00 and £10.75. No CVP shall be payable if Brit Insurance's Pro-forma 2010 Year End NTAV Per Share is equal to or less than £10.75.

The amount of the CVP will be quantified within a short time frame after the audit of Brit Insurance's accounts for the year ending 31 December 2010.

The adjustments which will be applied to Brit Insurance's audited consolidated net tangible asset value as at 31 December 2010 for the purpose of evaluating the Pro-forma 2010 Year End NTAV Per Share include: adding (a) the aggregate amount of the £0.30 Capital Distribution to the extent it has been paid; (b) the net UK corporation tax benefit arising in respect of Brit Shares acquired under the Brit Share Schemes; and (c) the proceeds of the exercise prices of in the money options, and deducting: (a) the aggregate amount of reserve releases since 30 June 2010 which have been released from the reserves existing at 31 December 2009 to the extent that such amount is in excess of £20 million in aggregate; (b) Brit Insurance's fees, costs and expenses of the Offer and any competing transaction and the cost of bonuses relating thereto to the extent not already allowed for in Brit Insurance's audited accounts for the financial year ending 31 December 2010; (c) certain directors' and officers' insurance costs; and (d) a review of the carrying value of the investment in Ri3k Limited. 

Accepting Brit Shareholders will, pursuant to the terms of the Offer, be entitled to receive the CVP (but only to the extent it is payable). The entitlement to receive any payment under the CVP is non-transferable and no security or certificate will be issued in connection with it.

Due to the influence of a number of external factors on the Brit Group, including potential catastrophe losses, foreign exchange rates and investment returns, Brit Shareholders should note that there can be no guarantee that Brit Shareholders will receive the maximum £0.25 per Brit Share, or any payment of the CVP at all.

A calculation of the Pro-forma 2010 Year End NTAV Per Share will be prepared by Brit Insurance following the audit of Brit Insurance's accounts for the year ending 31 December 2010, following which Achilles will be entitled to review the calculation (together with supporting documentation) and agree the Pro-forma 2010 Year End NTAV Per Share with the Independent Directors (or, if the calculation is finalised after the Offer becomes wholly unconditional, those Independent Directors who remain on the Brit Board at that date).

Achilles and Brit Insurance have agreed that the process for reviewing the draft calculation and agreeing (or, as the case may be, determining) the Pro-forma 2010 Year End NTAV Per Share will be completed within 20 business days of the approval of Brit Insurance's audited accounts for the year ending 31 December 2010 provided that the Offer has become or been declared unconditonal in all respects. Any dispute between Achilles and the Independent Directors in connection with the calculation of the Pro-Forma 2010 Year End NTAV Per Share will be referred to an independent firm of accountants, whose determination will be final and binding.

John Barton and Peter Hazell will remain independent directors on the Brit Board and Brit Insurance's audit committee to assist with and approve the CVP determination.

Achilles will pay the CVP (to the extent payable) within 14 days of the agreement (or, in the case of a dispute, the determination) of the Pro-forma 2010 Year End NTAV Per Share (or within 14 days of any subsequent acceptance).

Further details of the CVP memorandum which sets out the terms, including the agreed adjustments referred to above and the process for determining the CVP, will be set out in the Offer Document.

4. Recommendation

Lexicon Partners is acting as the independent financial adviser to the Independent Directors of Brit Insurance in connection with the Offer under Rule 3 of the Takeover Code. The Independent Directors of Brit Insurance, who have been so advised by Lexicon Partners, consider the Offer to be fair and reasonable and intend unanimously to recommend that Brit Shareholders accept the Offer and vote in favour of the Resolutions at the Brit General Meeting. In providing its advice to the Independent Directors, Lexicon Partners has taken into account the Independent Directors' commercial assessments.

Achilles has received irrevocable undertakings from:

·; certain Independent Directors to accept the Offer and vote in favour of the Resolutions in respect of all of their beneficial holdings totalling 141,715 Brit Shares representing approximately 0.18 per cent. of the existing issued ordinary share capital of Brit Insurance;

·; the CEO of Brit Insurance, Dane Douetil, and all of the other Managers to accept the Offer and vote in favour of the Resolutions (other than the Resolution approving the Management Arrangements on which they will not be entitled to vote) in respect of all of their beneficial holdings totalling 281,402 Brit Shares representing approximately 0.36 per cent. of the existing issued ordinary share capital of Brit Insurance; and

·; certain Independent Directors and Managers (including Dane Douetil) to accept the Offer or the proposals to be made by Achilles to holders of options and awards over up to 970,461 Brit Shares in aggregate representing approximately 1.23 per cent. of the existing issued ordinary share capital of Brit Insurance.

The Brit Shares and the options and awards over Brit Shares referred to above represent 1.76 per cent. of the existing issued share capital of Brit Insurance.

These undertakings remain binding even in the event of a higher competing offer for Brit Insurance.

5. Background to and reasons for the Offer

The members of the Consortium are substantial investment managers with significant experience in investing in financial services, in the UK and abroad. Each has been actively investigating the possibility of making investments in the insurance sector. Details of the Consortium are set out in paragraph 8 below.

The Consortium identified Brit Insurance as an attractive platform due to its quality franchise, solid balance sheet and globally diversified footprint. A generally challenging insurance underwriting environment characterised by 'soft' market conditions in a number of lines combined with a low interest rate environment has, in the Consortium's view, enabled it to offer a very substantial premium to shareholders whilst at the same time meeting the Consortium members' disciplined approach to investment.

The Consortium believes that in private ownership Brit Insurance will be better able to actively manage its underwriting exposures and react more nimbly to market opportunities and challenges presenting themselves throughout the insurance cycle.

6. Background to and reasons for the recommendation

Brit Insurance has been in an Offer Period since 11 June 2010, the date on which Apollo's initial offer proposal was announced. Since that date, the Brit Board and its Independent Directors have met on a frequent basis, together with their advisers, to discuss the process and take any necessary key decisions with a view to maximising value for Brit Shareholders and ensuring that any transaction is in the best interests of Brit Insurance, its shareholders and its other stakeholders.

Following Apollo and the CVC Funds forming the Consortium, the Brit Board announced on 17 September 2010 that it had negotiated improved proposed offer terms, with the inclusion of the CVP, and that the Independent Directors had indicated that they expected to recommend an offer on the proposed terms to Brit Shareholders, provided that the other terms and conditions of any offer made by the Consortium were acceptable and the pre-conditions satisfied within a reasonable timeframe. 

In considering whether to recommend the Offer, the Independent Directors took into account, inter alia, the following factors:

·; The aggregate amount payable under the Proposal of £10.75 to £11.00 per Brit Share represents a premium of between approximately 47 per cent. to 51 per cent. above the Closing Price per Brit Share on 10 June 2010 (being the last Business Day prior to the commencement of the Offer Period) and a premium of between approximately 40 per cent. to 44 per cent. to the average Closing Price per Brit Share of £7.66 for the six month period prior to the commencement of the Offer Period;

·; The inclusion of the CVP will provide additional value to Brit Shareholders if Brit Insurance's audited consolidated net tangible asset value as at 31 December 2010, after adjustment for certain items including those referred to in paragraph 3 above, is greater than £10.75 per Brit Share;

·; The Independent Directors are confident about Brit Insurance's future prospects, and believe that Brit Insurance's "average to outperform" agenda should improve Brit Insurance's financial performance over time. However, they accept that (in the absence of the Offer) it would be unlikely that Brit Shares would trade at the valuation levels implied by the Proposal in the short to medium term, particularly given the challenging outlook for the insurance market;

·; The completion of the Offer may afford Brit Insurance greater flexibility to respond rapidly to changes in market conditions, to the benefit of Brit Insurance's various stakeholders;

·; The views expressed by leading Brit Shareholders regarding the proposed Offer terms;

·; The absence of other potential offerors approaching Brit Insurance with potentially superior proposals during the Offer Period; and

·; The credibility and track record of the Consortium members in executing transactions of this nature.

7. Financing of the Offer

The Offer consideration (assuming the maximum amount is payable under the CVP) of approximately £865 million will be funded equally by the Apollo Fund and the CVC Funds, and potentially, in relation to any amounts payable under the CVP, a loan facility obtained by Achilles. The Apollo Fund and the CVC Funds will subscribe for ordinary shares in Achilles' parent companies in order to provide Achilles with the cash resources necessary to pay the Offer consideration (in addition to any cash drawn down under the loan facility).

BofA Merrill Lynch is satisfied that sufficient resources are available to Achilles to satisfy in full the cash consideration payable by Achilles to Brit Shareholders under the terms of the Offer.

8. Information relating to the Consortium

Information relating to Apollo

Apollo Management, the parent company of Apollo, is a leading global alternative asset manager with offices in New York, Los Angeles, London, Frankfurt, Luxembourg, Singapore, Mumbai and Hong Kong. Apollo Management had assets under management of US$54.5 billion as of 30 June 2010, in private equity, credit-oriented capital markets and real estate funds invested across a core group of nine industries where Apollo Management has considerable knowledge and resources.

Information relating to the CVC Group

The CVC Group is a leading global private equity firm with a network of 20 offices across Europe, Asia and the US and assets under management of approximately US$36 billion as at 30 June 2010. The CVC Group has significant expertise in the financial services sector including recent investments by funds advised by CVC in Acromas (the UK personal lines insurance broker and underwriter operating through the AA and Saga brands) and Avolon (the Irish-based aircraft leasing company). The CVC Group also has a strong track-record in the UK with public to private takeover situations including: Debenhams plc, IG Group plc and Collins Stewart plc.

Funds advised by CVC currently have a diverse portfolio of investments in 56 companies worldwide, employing over 400,000 people and with combined sales of approximately £69 billion. Working together with portfolio company management teams, industrial advisors and appointed non-executive directors, the CVC Group develops strategies to improve the investee companies' performance and to create long-term value.

9. Information relating to Achilles

Achilles is a newly incorporated company under the laws of the Netherlands, formed on behalf of, and which will be majority owned by, funds managed by Apollo Management VII, L.P. and funds advised by CVC Capital Partners Limited, for the purpose of implementing the Offer. The current directors of Achilles are Michael Kidd, appointed by the Apollo Fund, and Manuel Mouget, appointed by the CVC Funds.

The Achilles Group consists of three companies. Achilles' immediate parent company is AH2 and its ultimate parent company is AH1. Each of AH1 and AH2 is a newly-incorporated company incorporated in Luxembourg for the purpose of implementing the Offer.

None of the companies in the Achilles Group have traded since incorporation, nor have they entered into any obligations, other than in connection with the Offer and financing of the Offer.

Further details in relation to the Achilles Group will be contained in the Offer Document.

10. Information relating to Brit Insurance

Brit Insurance is an international general insurance and reinsurance group specialising in commercial insurance. The Brit Group underwrites through three strategic business units - Global Markets, Reinsurance and UK - using three principal underwriting platforms: Lloyd's Syndicate 2987, Brit Insurance Limited, which is regulated by the FSA and Brit Insurance (Gibraltar) PCC Limited, which is regulated by the Gibraltar Financial Services Commission.

The Brit Group's holding company, Brit Insurance Holdings N.V., is located in the Netherlands. Brit Insurance's ordinary shares are listed on the London Stock Exchange and the Brit Group is a constituent of the FTSE 250 Index.

For further information regarding Brit Insurance's current trading and prospects, Brit Shareholders are directed to the interim management statement published today which is available at http://investor.britinsurance.com.

11. Irrevocable undertakings to accept the Offer

Achilles has procured irrevocable undertakings from:

• John Barton, Joe MacHale, Cees Schrauwers and Matthew Scales (who hold in aggregate 141,715 Brit Shares, representing approximately 0.18 per cent. of the existing issued ordinary share capital of Brit Insurance) to accept the Offer and vote in favour of the Resolutions;

• Matthew Scales to accept the Offer or the proposals to be made by Achilles to holders of options and awards over up to 197,953 Brit Shares in aggregate representing 0.25 per cent. of the existing issued share capital of Brit Insurance; and

• Dane Douetil, Malcolm Beane, Matthew Wilson, Jonathan Turner and Ray Cox (who hold in aggregate 281,402 Brit Shares, representing approximately 0.36 per cent. of the existing issued ordinary share capital of Brit Insurance) to accept the Offer and vote in favour of the Resolutions (other than the Resolution approving the Management Arrangements on which they will not be entitled to vote) and to accept the Offer or the proposals to be made by Achilles to holders of options and awards over up to 772,508 Brit Shares in aggregate representing approximately 0.98 per cent. of the existing issued ordinary share capital of Brit Insurance.

The Brit Shares and the options and awards over Brit Shares referred to above represent 1.76 per cent. of the existing issued share capital of Brit Insurance.

These undertakings remain binding even in the event of a competing higher offer for Brit Insurance.

Further details of these irrevocable undertakings are set out in Appendix 3.

12. Implementation Agreement and Break Fee

Brit Insurance, Achilles, AH2, Apollo, CVC and CVC Funds have entered into an Implementation Agreement in relation to the implementation of the Offer and related matters. Pursuant to the Implementation Agreement, Brit Insurance has given certain assurances and confirmations, including regarding the conduct of the business of Brit Insurance pending implementation of the Offer.

Non-solicitation arrangements

Brit Insurance has undertaken, amongst other things, not to, and to procure that no member of the Brit Group nor any connected person will, directly or indirectly solicit or initiate any proposal from any person with a view to an alternative transaction with a third party being proposed or taking place.

Brit Insurance has also undertaken to notify Achilles, Apollo and the CVC Funds promptly if any approach is made to it regarding any alternative transaction with a third party.

Break fee arrangements

Brit Insurance has agreed to pay Achilles' parent company a break fee of £8.4 million if:

(i) an alternative transaction with a third party is announced before the Offer lapses or is withdrawn which is inconsistent with the Offer and either (a) it is recommended by a majority of the Independent Directors or (b) it becomes effective or is declared unconditional or is otherwise completed or, not being a competing offer, is entered into by Brit Insurance; or

(ii) the Independent Directors fail to express in the Offer Document (or the position statement appended to the Offer Document), or withdraw, modify or qualify at any time, their unanimous and unqualified recommendations to Brit Shareholders to accept the Offer and/or to vote in favour of the Resolution to approve the Management Arrangements or the Resolutions to appoint directors nominated by Achilles to the Brit Board; or

(iii) Brit Insurance fails to convene a general meeting in accordance with the Implementation Agreement.

Further information regarding the Implementation Agreement will be set out in the Offer Document.

13. Directors, employees and locations

Achilles and Brit Insurance intend that, if the Offer is declared wholly unconditional, the Brit Board will include Dane Douetil who will continue as chief executive officer, together with two Dutch independent directors (one of whom is intended to be Willem Stevens) and, subject to Brit Shareholder approval and regulatory approval, six directors appointed by the Consortium. In addition, John Barton and Peter Hazell will remain as Brit Directors until such time as the CVP has been determined and to the extent payable, paid. Matthew Scales, Joe MacHale and Cees Schrauwers will resign as Brit Directors on the Offer becoming wholly unconditional.

Achilles attaches great importance to the skills and experience of the existing management and employees of Brit Insurance. Achilles has given assurances to the Independent Directors that, on the Offer becoming or being declared unconditional in all respects, it is its intention that the Brit Group employers will continue to comply with their legal obligations in relation to pensions and employment rights of all Brit Group employees.

Achilles has no current intention to change the location of the Brit Group's places of business.

14. Management Arrangements

Following the announcement on 17 September 2010 that the Independent Directors expected to recommend an offer on the proposed terms, the Independent Directors authorised Dane Douetil to negotiate the terms of the Management Arrangements and agreed that Brit Insurance would fund certain legal and financial advisory costs incurred on behalf of Management in relation thereto.

The Management Arrangements provide that, following the Offer becoming or being declared unconditional in all respects, Management, including Dane Douetil, will invest up to £1.5 million to subscribe for ordinary shares in AH2. In addition, a pool of further ordinary shares in AH2 will be available for future issuance to new or existing members of Management. The total number of shares available to Management will represent up to 9.5 per cent. of the issued ordinary share capital of AH2, of which three-quarters will be issued to Management on completion of the Offer and the balance will be available for future issuance. The AH2 ordinary shares will rank behind a class of preference shares owned by AH1 which will be primarily owned by the Consortium.

Certain members of Management, including Dane Douetil, will also subscribe for ordinary shares in AH1 of the same class which the Apollo Fund and the CVC Funds will hold. The funds subscribed to AH1 by Management and the Consortium will be used to invest in AH2 preference shares and AH2 ordinary shares. The terms of the AH2 preference shares include provisions for a payment in kind coupon of 12 per cent. per annum which needs to be paid in full before any amounts are distributable to the holders of AH2 ordinary shares.

Pursuant to the Takeover Code and under Brit Insurance's articles of association, the proposed Management Arrangements are required to be approved by Independent Shareholders voting on a poll. Accordingly, a resolution to approve the Management Arrangements will be proposed at the Brit General Meeting. To be passed, this resolution will require more than 50 per cent. of the votes cast by Independent Shareholders (either in person or by proxy) to be voted in favour.

Lexicon Partners considers in its opinion that the terms of the Management Arrangements are fair and reasonable.

The Offer will be conditional on the Independent Shareholders of Brit Insurance approving the Management Arrangements as described above.

Full details of the terms of the Management Arrangements will be set out in the Offer Document.

15. Brit Share Schemes

The Offer will extend to any Brit Shares which are issued while the Offer remains open for acceptance (or such earlier date as Achilles may decide, subject to the Takeover Code, or with the consent of the Panel, and subject to the Dutch Civil Code), including any such Brit Shares issued pursuant to the exercise of options or vesting of awards granted under the Brit Share Schemes.

Achilles will make appropriate proposals to the holders of outstanding options and awards in the Brit Share Schemes in due course.

16. Squeeze‑out, delisting, cancellation of trading and re‑registration

If the Offer becomes or is declared unconditional in all respects and Achilles receives acceptances under the Offer in respect of, and/or otherwise acquires, 95 per cent. or more of the Diluted Share Capital, Achilles intends to exercise its rights pursuant to the provisions of the Dutch Civil Code to compulsorily acquire any remaining Brit Shares.

If the Offer becomes or is declared unconditional in all respects and Achilles has received sufficient acceptances of the Offer, Achilles intends to procure the delisting of Brit Insurance. In such circumstances, Brit Insurance has agreed to make applications to cancel the trading in Brit Shares on the London Stock Exchange's market for listed securities and to cancel the listing of Brit Shares on the UKLA's Official List. A notice period of not less than 20 UK business days prior to the cancellation will commence on the date on which the Offer becomes or is declared unconditional in all respects, provided Achilles has attained 75 per cent. or more of the voting rights of Brit Insurance, or otherwise as soon as Achilles attains 75 per cent. or more of the voting rights of Brit Insurance. Delisting would significantly reduce the liquidity and marketability of any Brit Shares not assented to the Offer.

Achilles also intends to propose that, following the Offer becoming or being declared unconditional in all respects and after the Brit Shares are delisted, Brit Insurance will amend its articles of association and be converted into a private company with limited liability under the relevant provisions of the Dutch Civil Code.

17. Brit Shares being acquired

The Brit Shares will be acquired pursuant to the Offer fully-paid and free from all liens, charges, equities, encumbrances, rights of pre‑emption and any other interests of any nature whatsoever and together with all rights now or hereafter attaching thereto, including without limitation voting rights and the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid on or after 28 July 2010, other than the £0.30 Capital Distribution.

18. Interests in Brit Insurance securities

No Opening Position Disclosure (as defined in the Takeover Code) was required to be made pursuant to Rule 8.1(a) of the Takeover Code.

19. Brit General Meeting and Offer Document

The Brit General Meeting at which the Resolutions will be proposed will be convened on or before 5 November 2010 by posting the notice of meeting on Brit Insurance's website (http://investor.britinsurance.com). The Brit General Meeting is expected to take place on or around 17 December 2010. Brit Shareholders will be sent a hard copy of the notice of meeting at the same time as the Offer Document is posted.

The Resolution to approve the Management Arrangements is required by Brit Insurance's articles of association and the Takeover Code. Under the Takeover Code, this approval must be given by way of a separate vote of Independent Shareholders, taken on a poll and requiring approval by a simple majority of the votes cast by Independent Shareholders. The remaining Resolutions each require approval by a simple majority of the votes cast by Brit Shareholders.

Further details of the Resolutions and the Brit General Meeting will be set out in the Offer Document. The formal Offer Document will be sent to Brit Shareholders (other than to persons resident in a Restricted Jurisdiction) in due course.

Advisers

Brit Insurance is receiving financial advice from Lexicon Partners and J.P. Morgan Cazenove. Achilles is receiving financial advice from BofA Merrill Lynch, Willis Capital Markets & Advisory, Citi and West Hill Corporate Finance.

Enquiries:

The conditions to, and certain further terms of, the Offer are set out in Appendix 1. The bases and sources for certain financial information contained in this announcement are set out in Appendix 2. Details of irrevocable undertakings received by Achilles are set out in Appendix 3. Certain definitions and terms used in this announcement are set out in Appendix 4.

Merrill Lynch International (BofA Merrill Lynch), a subsidiary of Bank of America Corporation, Willis Capital Markets & Advisory, Citigroup Global Markets Limited and West Hill Corporate Finance are acting exclusively for Achilles and no one else in connection with the Offer and this announcement and will not be responsible to anyone other than Achilles for providing the protections afforded to their clients or for providing advice in connection with the Offer or any matter referred to herein.

Lexicon Partners and J.P. Morgan Cazenove are acting exclusively for Brit Insurance and no one else in connection with the Offer and this announcement and will not be responsible to anyone other than Brit Insurance for providing the protections afforded to their clients or for providing advice in connection with the Offer or any matter referred to herein.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities, pursuant to the Offer or otherwise. The Offer will be made solely by the Offer Document, when issued, which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. Any acceptance or other response to the Offer should be made on the basis of the information in the Offer Document.

In accordance with Rule 2.10 of the UK Takeover Code, the current issued share capital of Brit Insurance comprises 79,162,725 ordinary shares of €3.64 each. The ISIN for those securities is NL0009347863.

Overseas jurisdictions

This announcement has been prepared for the purpose of complying with English and Dutch law and the information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside the United Kingdom and the Netherlands.

The Offer will be subject to the applicable rules and regulations of the UKLA, the London Stock Exchange, the UK Takeover Panel, the Dutch decree on public offers (Besluit openbare biedingen), the Dutch Financial Supervision Act (Wet op het financieel toezicht) and the Dutch Civil Code (Burgerklijk Wetboek).

The release, publication or distribution of this announcement in certain jurisdictions may be affected by the laws of relevant jurisdictions. Persons who are subject to the laws of any jurisdiction other than the United Kingdom or the Netherlands or are not resident in the United Kingdom or the Netherlands will need to inform themselves about, and observe, any applicable requirements.

Unless otherwise determined by Achilles or required by the UK Takeover Code and permitted by applicable law and regulation, the Offer will not be, made, directly or indirectly, in or into or by the use of the mails of, or by any other means or instrumentality (including, without limitation, electronic mail, facsimile transmission, telex, telephone, internet or other forms of electronic communication) of interstate or foreign commerce of, or any facility of a national state or other securities exchange of any Restricted Jurisdiction and will not be capable of acceptance by any such use, means, instrumentality or facility or from within any Restricted Jurisdiction.

Accordingly, unless otherwise determined by Achilles or required by the UK Takeover Code and permitted by applicable law and regulation, copies of this announcement and any documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed, transmitted or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction and persons receiving this announcement (including, without limitation, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in, into or from any Restricted Jurisdiction, as doing so may invalidate any purported acceptance of the Offer. Any person (including, without limitation, custodians, nominees and trustees) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement and/or the Offer Document and/or any other related document to any jurisdiction outside the United Kingdom or the Netherlands should inform themselves of, and observe, any applicable legal or regulatory requirements of any relevant jurisdiction.

Notice to US investors

The Offer is for the securities of a corporation organised under the laws of the Netherlands and is subject to the procedure and disclosure requirements of the United Kingdom, which are different from those of the United States. The Offer is being made in the United States pursuant to Section 14(e) of, and Regulation 14E under, the US Securities Exchange Act of 1934, as amended (the "Exchange Act"), subject to exemptions provided by Rule 14d-1(d) under the Exchange Act and otherwise in accordance with the requirements of the Takeover Code. Accordingly, the Offer is subject to disclosure and other procedural requirements, including with respect to withdrawal rights, the offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and laws.

To the extent permitted by applicable law, in accordance with, and to the extent permitted by, the Takeover Code and normal UK market practice and Rule 14e-5 under the Exchange Act, Achilles or its nominees or brokers (acting as agents) or their respective affiliates may from time to time make certain purchases of, or arrangements to purchase, Brit Shares, other than pursuant to the Offer, before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Such purchases, or arrangements to purchase, will comply with all applicable UK rules, including the Takeover Code and the rules of the London Stock Exchange, and Rule 14e-5 under the Exchange Act to the extent applicable, In addition, in accordance with, and to the extent permitted by, the Takeover Code, normal UK market practice and Rule 14e-5 under the Exchange Act, BofA Merrill Lynch and Citi and their respective affiliates will continue to act as exempt principal traders in Brit Shares on the London Stock Exchange and engage in certain other purchasing activities consistent with their respective normal and usual practice and applicable law, including Rule 14e-5 under the Exchange Act. Any information about such purchases will be disclosed on a next day basis to the Panel and will be available from any Regulatory Information Service including the Regulatory News Service on the London Stock Exchange website, www.londonstockexchange.com. To the extent that such information is made public in the United Kingdom, this information will also be publicly disclosed in the United States.

Each US shareholder of Brit Shares is urged to consult with his independent professional adviser regarding any acceptance of the Offer.

This announcement does not constitute an offer of securities for sale in the United States or an offer to acquire or exchange securities in the United States. No offer to acquire securities or to exchange securities for other securities has been made, or will be made, directly or indirectly, in or into, or by use of the mails, any means or instrumentality of interstate or foreign commerce or any facilities of a national securities exchange of, the United States or any other country in which such offer may not be made other than (i) in accordance with the tender offer requirements under the Exchange Act or the securities laws of such other country, as the case may be, or (ii) pursuant to an available exemption from such requirements. Neither the US Securities and Exchange Commission (the "SEC") nor any US state securities commission has approved or disapproved this Offer or passed upon the adequacy of completeness of this document or the Offer document. Any representation to the contrary is a criminal offence.

It may be difficult for US holders of Brit Insurance securities to enforce their rights and any claim arising out of the US federal securities laws, since Achilles and Brit Insurance are located outside of the United States, and some or all of their officers and directors may be resident outside of the United States. US holders of Brit Insurance securities may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the US securities laws. Further, it may be difficult to compel a foreign company and its affiliates to subject themselves to a US court's judgment.

Forward-looking statements

This announcement, including information included or incorporated by reference in this announcement, may contain "forward-looking statements" concerning the Consortium, Achilles and Brit Insurance. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward‑looking statements. The forward‑looking statements involve risks and uncertainties that could cause actual results to differ materially from those suggested by them. Many of these risks and uncertainties relate to factors that are beyond the abilities of the Consortium, Achilles and Brit Insurance to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this announcement. The Consortium, Achilles and Brit Insurance assume no obligation and do not intend to update these forward‑looking statements, except as required pursuant to applicable law.

Disclosure requirements of the UK Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Publication on website

In accordance with Rule 19.11 of the Takeover Code, a copy of this announcement will be available at http://investor.britinsurance.comby no later than 12 noon on 27 October 2010.

Appendix 1CONDITIONS AND FURTHER TERMS OF THE Offer

Part I : conditions of the offer

The Offer will be subject to the shared jurisdiction of the Panel and the Netherlands Authority for the Financial Markets (Stichting Autoriteit Financiële Markten). The terms of the Offer, which will be made by Achilles, will comply with the UK Takeover Code with regard to consideration and procedural matters (as defined in paragraph 3(a) of the Introduction to the Takeover Code). Matters relating to employee information and company law matters (in particular the percentage of voting rights which confer control and any derogation from the obligation to launch a mandatory offer, as well as the conditions under which Brit Insurance may undertake any actions which might result in the frustration of the Offer) will be governed by Dutch corporate law and the provisions of the Dutch decree on public offers, as the case may be. 

The Offer to Brit Shareholders will be governed by English law and will be subject to the exclusive jurisdiction of the courts of England. It will be subject to the terms and conditions to be set out in the Offer Document.

The Offer will be subject to the following conditions:

Acceptance Condition

1. valid acceptances of the Offer being received (and not, where permitted, withdrawn) by no later than 1.00 p.m. (London time) on the first closing date as set out in the Offer Document (or such later time(s) and/or date(s) as Achilles may, in accordance with the Takeover Code or with the consent of the Panel, decide) in respect of not less than 95 per cent. (or such lesser percentage as Achilles may decide) of the Diluted Share Capital of Brit Insurance, provided that this condition will not be satisfied unless Achilles and/or any member of the Achilles Group shall have acquired or agreed to acquire (whether pursuant to the Offer or otherwise) Brit Shares carrying in aggregate more than 50 per cent. of the voting rights then normally exercisable at a general meeting of Brit Insurance; 

Passing the Resolution to approve the Management Arrangements

2. the passing at the Brit General Meeting (or at any adjournment of the meeting) of the resolution to approve the Management Arrangements;

Regulatory conditions

3. the FSA giving notice in writing under section 189(4) of FSMA, in terms reasonably satisfactory to Achilles, of its approval (or being treated as having given its approval by virtue of section 189(6) of FSMA) in respect of any acquisition of or increase in control over (as defined in sections 181 and 182 of FSMA) any member of the Wider Brit Group which is a UK authorised person (as defined in section 191G(1) of FSMA), which in either case would result from implementation of the Offer;

4. Lloyd's providing consent in writing under section 12 of the Lloyd's Membership Byelaw or section 43 of the Lloyd's Underwriting Byelaw (as the case may be), in terms reasonably satisfactory to Achilles, in respect of any change in the controller of any member of the Brit Group which is a corporate member or a managing agent of Lloyd's which would result from implementation of the Offer;

5. the Gibraltar Financial Services Commission providing consent in writing under sections 39 to 46 as set out in Part V of the Financial Services (Insurance Companies) Act 1987 ("FSICA"), in terms reasonably satisfactory to Achilles, in respect of any change in the controller of any member of the Brit Group which is an insurer which holds a valid license issued under FSICA (as licensed insurer is defined in section 2 of FSICA) which would result from implementation of the Offer;

6. there being in full force and effect all other necessary Relevant Authority Clearances including all authorisations, consents and approvals required from the FSA, Lloyd's and the Gibraltar Financial Services Commission for the implementation and entering into of the Offer, without any conditions, requirements, limitations, restrictions or undertakings, except for any conditions, requirements, limitations, restrictions or undertakings customarily imposed by the applicable regulatory body in change of control transactions (which conditions shall not include any obligation by or on behalf of Achilles, Apollo or the CVC Group or any of their respective Affiliates to (i) invest, contribute or loan capital or assets to, guarantee or pledge capital or assets for the benefit of, or maintain, support or guarantee a minimum level of capital or surplus of, Brit Insurance or any other member of the Brit Group, (ii) sell, divest, hold separate, or otherwise dispose of any of their or of Brit Insurance's or any other member of the Brit Group's respective businesses, operations, product lines or assets or (iii) conduct Brit Insurance's or any other member of the Brit Group's respective businesses in a specified manner), in each case to an extent which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

European Union merger control

7. in so far as the Offer constitutes, or is deemed pursuant to Article 4(5) of Council Regulation 139/2004/EC (the "Regulation") to constitute a concentration with a Community dimension within the scope of the Regulation, the European Commission taking a decision, under Article 6(1)(b) of the Regulation or being deemed to have taken such a decision by operation of Article 10(6) of the Regulation, in terms satisfactory to Achilles, that the proposed acquisition of Brit Insurance by Achilles, or any matter arising therefrom, is compatible with the common market;

8. in the event that a request under Article 9(2) of the Regulation has been made by a European Union or EFTA state, the European Commission indicating, in terms satisfactory to Achilles, that it does not intend to refer the proposed acquisition, or any aspect of the proposed acquisition, to a competent authority of such state in accordance with Article 9(3)(b) of the Regulation;

9. in the event of a referral of the proposed acquisition, or any aspect of the proposed acquisition, to a competent authority of a European Union or EFTA state in accordance with Article 9(3)(b) of the Regulation, and in the event that Achilles waives, in whole or in part, Condition 8 in relation to such referral, such competent authority adopting a decision or providing such other indication of its position as shall be satisfactory to Achilles;

10. no indication having been made that a European Union or EFTA state may take any measure pursuant to Article 21(4) of the Regulation in relation to the Offer or any aspect of the Offer;

US merger control

11. all necessary notifications and filings having been made and all applicable waiting periods (including any extensions thereof) under the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976 (as amended) and the rules and regulations made thereunder having expired, lapsed or been terminated as appropriate in each case in respect of the Offer (including, without limitation, to its implementation and financing) and the acquisition or the proposed acquisition of any shares or other securities in, or control of, Brit Insurance by any member of the Wider Achilles Group;

Other Third Party approvals

12. no Third Party having decided to take, institute, implement or threaten any action proceeding, suit, investigation, enquiry or reference, or having required any action to be taken or otherwise having done anything or having enacted, made or proposed any statute, regulation, decision, order or change to published practice and there not continuing to be outstanding any statute, regulation, decision or order which would or might:

(i) make the Offer, its implementation or the acquisition or proposed acquisition of any shares or other securities in, or control or management of any member of the Wider Brit Group by any member of the Wider Achilles Group void, illegal and/or unenforceable under the laws of any relevant jurisdiction, or otherwise directly or indirectly prevent, prohibit, or restrain, restrict, delay or otherwise interfere with the implementation of, or impose additional material conditions or obligations with respect to, or otherwise impede, challenge, interfere or require amendment of the Offer or the acquisition of any shares or other securities in, or control or management of Brit Insurance by any member of the Wider Achilles Group;

(ii) require, prevent or delay the divestiture or alter the terms envisaged for such divestiture by any member of the Wider Achilles Group or by any member of the Brit Group of all or any part of their businesses, assets or property or impose any limitation on the ability of all or any of them to conduct their businesses (or any part thereof) or to own, control or manage any of their assets or properties (or any part thereof), to an extent which is material in context of the Brit Group taken as a whole or in the context of the Offer;

(iii) impose any limitation on, or result in a delay in, the ability of any member of the Wider Achilles Group directly or indirectly to acquire or hold or to exercise effectively all or any rights of ownership in respect of shares or other securities in Brit Insurance (or any member of the Wider Brit Group) or on the ability of any member of the Wider Achilles Group directly or indirectly to hold or exercise effectively any rights of ownership in respect of shares or other securities (or the equivalent) in, or to exercise management control over, any member of the Wider Brit Group, to an extent which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

(iv) other than pursuant to the implementation of the Offer, require any member of the Wider Achilles Group or the Wider Brit Group to acquire or offer to acquire any shares, other securities (or the equivalent) or interest in any member of the Wider Brit Group or any asset owned by any third party (other than in the implementation of the Offer) which is material in the context of the Wider Brit Group or the Apollo Fund Group or the CVC Group, in each case taken as a whole;

(v) require, prevent or materially delay a divestiture by any member of the Wider Achilles Group of any shares or other securities (or the equivalent) in any member of the Wider Brit Group;

(vi) result in any member of the Wider Brit Group ceasing to be able to carry on business under any name under which it presently carries on business, to an extent which is material in context of the Brit Group taken as a whole or in the context of the Offer;

(vii) impose any material limitation on the ability of any member of the Wider Achilles Group or any member of the Wider Brit Group to conduct, integrate or co-ordinate all or any part of their respective businesses with all or any part of the business of any other member of the Wider Achilles Group and/or the Wider Brit Group in a manner which is adverse to and material in the context of the Apollo Fund Group, the CVC Group and/or the Wider Brit Group, in each case taken as a whole, or in the context of the Offer;

(viii) otherwise adversely affect the business, assets, value, profits, prospects or operational performance of any member of the Wider Achilles Group or any member of the Wider Brit Group in a manner which is adverse to and material in the context of the Apollo Fund Group, the CVC Group and/or the Wider Brit Group, in each case taken as a whole, or in the context of the Offer,

and all applicable waiting and other time periods (including any extensions thereof) during which any such Third Party could decide to take, institute, implement or threaten any such action, proceedings, suit, investigation, enquiry or reference or take any other step under the laws or any jurisdiction in respect of the Offer or the acquisition or proposed acquisition of any Brit Shares or otherwise intervene having expired, lapsed, or been terminated;

13. all notifications, filings or applications which are necessary or which are deemed by Achilles (acting reasonably) to be appropriate having been made in connection with the Offer and all necessary waiting and other time periods (including any extensions thereof) under any applicable legislation or regulation of any jurisdiction having expired, lapsed or been terminated (as appropriate) and all statutory and regulatory obligations in any jurisdiction having been complied with and all authorisations necessary or appropriate in any jurisdiction for or in respect of the Offer or the acquisition or the proposed acquisition of any shares or other securities in, or control of, Brit Insurance by any member of the Wider Achilles Group having been obtained in terms and in a form satisfactory to Achilles from any such regulator or body and all such authorisations necessary or appropriate to carry on the business of any member of the Brit Group in any jurisdiction having been obtained in each case where the direct consequence of a failure to make such notification or filing or to wait for the expiry, lapse or termination of any such waiting or other time period or to comply with such obligation or obtain such authorisation would be unlawful in any relevant jurisdiction or have a materially adverse effect on the Brit Group, any member of the Wider Achilles Group or the ability of the Consortium or Achilles to implement the Offer and all such authorisations remaining in full force and effect at the time at which the Offer becomes otherwise unconditional and there being no notice or intimation of an intention to revoke, suspend, restrict, modify or not to renew such authorisations;

14. no temporary restraining order, preliminary or permanent injunction, preliminary or permanent enjoinment, or other order threatened or issued and being in effect by a court or other Third Party which has the effect of making the Offer or any acquisition or proposed acquisition of any shares or other securities or control or management of, any member of the Wider Brit Group by any member of the Wider Achilles Group, or the implementation of either of them, void, voidable, illegal and/or enforceable under the laws of any relevant jurisdiction, or otherwise directly or indirectly prohibiting, preventing, restraining, restricting, delaying or otherwise interfering with the consummation or the approval of the making of the Offer or any matter arising from the proposed acquisition of any shares or other securities in, or control or management of, any member of the Wider Brit Group by any member of the Wider Achilles Group;

Non-existence of certain provisions

15. except as publicly announced to a Regulatory Information Service by or on behalf of Brit Insurance before 26 October 2010 or as fairly disclosed in writing by Brit Insurance to Achilles before 26 October 2010, there being no provision of any arrangement, agreement, licence, permit, franchise, lease or other instrument to which any member of the Wider Brit Group is a party or by or to which any such member or any of its assets is or may be bound or be subject or any event or circumstance which, as a consequence of the Offer or the acquisition or the proposed acquisition by any member of the Wider Achilles Group of any shares or other securities in Brit Insurance or because of a change in the control or management of any member of the Brit Group or otherwise, could or might reasonably be expected to result in, in each case to an extent which is material in the context of the Wider Brit Group taken as a whole or in the context of the Offer:

(i) any monies borrowed by, or any other indebtedness, actual or contingent, or any grant available to any member of the Wider Brit Group being or becoming repayable, or capable of being declared repayable, immediately or prior to its or their stated maturity date or repayment date, or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited;

(ii) the rights, liabilities, obligations, interests or business of any member of the Wider Brit Group or any member of the Wider Achilles Group under any such arrangement, agreement, licence, permit, lease or instrument or the interests or business of any member of the Wider Brit Group or any member of the Wider Achilles Group in or with any other firm or company or body or person (or any agreement or arrangement relating to any such business or interests) being or likely to become terminated or adversely modified or affected or any onerous obligation or liability arising or any adverse action being taken thereunder;

(iii) any member of the Wider Brit Group ceasing to be able to carry on business under any name under which it presently carries on business;

(iv) any assets or interests of, or any asset the use of which is enjoyed by, any member of the Wider Brit Group being or falling to be disposed of or charged or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any member of the Wider Brit Group;

(v) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any member of the Wider Brit Group or any such mortgage, charge or other security interest (whenever created, arising or having arisen), becoming enforceable;

(vi) the business, assets, value, financial or trading position, profits, prospects or operational performance of, any member of the Wider Brit Group being prejudiced or adversely affected;

(vii) the creation or acceleration of any liability (actual or contingent) by any member of the Wider Brit Group; or

(viii) any liability of any member of the Wider Brit Group to make any severance, termination, bonus or other payment to any of its directors or other officers;

No material transactions, claims or changes in the conduct of the business of the Brit Group

16. except as fairly disclosed in the Half Year Financial Report, or as publicly announced to a Regulatory Information Service by or on behalf of Brit Insurance before 26 October 2010 or as fairly disclosed in writing by Brit Insurance to Achilles before 26 October 2010, no member of the Wider Brit Group (save for Verex Group Limited, Xbridge Limited and Ri3k Limited and their subsidiaries) having since 31 December 2009:

(i) save as between Brit Insurance and its wholly‑owned subsidiaries or between such wholly‑owned subsidiaries, issued or agreed to issue or authorised or proposed the issue of additional shares of any class, or securities or securities convertible into, or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities (save, where relevant, as between Brit Insurance and wholly‑owned subsidiaries of Brit Insurance and save for the issue of Brit Shares on the exercise of options or vesting of awards granted before the date of this announcement under, or in the grant of rights before such date under, the Brit Share Schemes in each case to the extent fairly disclosed in writing by Brit Insurance to Achilles before 26 October 2010);

(ii) save for the capital distribution approved on 6 May 2010 and paid on 15 July 2010, and the capital distribution announced on 28 July 2010 and payable on 7 December 2010 (with a record date of 22 October 2010), recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution (whether payable in cash or otherwise) other than to Brit Insurance or one of its wholly‑owned subsidiaries;

(iii) save for transactions between Brit Insurance and its wholly‑owned subsidiaries or between such wholly-owned subsidiaries, merged with (by statutory merger or otherwise) or demerged from or acquired any body corporate, partnership or business or acquired or disposed of, or, other than in the ordinary course of business, transferred, mortgaged or charged or created any security interest over, any assets or any right, title or interest in any asset (including shares and trade investments) or authorised, proposed or announced any intention to do so;

(iv) save for transactions between Brit Insurance and its wholly-owned subsidiaries or between such wholly owned-subsidiaries, made, authorised, proposed or announced an intention to propose any change in its loan capital;

(v) issued, authorised or proposed the issue of any debentures or (save as between Brit Insurance and its wholly‑owned subsidiaries or between such wholly‑owned subsidiaries) incurred or increased any indebtedness or become subject to any contingent liability to an extent which is material in the context of the Brit Group or in the context of the Offer;

(vi) entered into or varied or authorised, proposed or announced its intention to enter into or vary any contract, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, unusual or onerous nature, or which involves or could reasonably be expected to involve an obligation of a nature or magnitude which is, in any such case, material in the context of the Brit Group or in the context of the Offer, or which is or is reasonably likely to be restrictive on the business of any member of the Wider Brit Group to an extent which is or is likely to be material to the Brit Group taken as a whole or in the context of the Offer, or which is or is likely to be restrictive on the business of any member of the Wider Achilles Group;

(vii) entered into or varied or authorised, proposed or announced its intention to enter into or vary to a material extent the terms of, or made any offer (which remains open for acceptance) to enter into or vary the terms of, any contract, commitment, arrangement or any service agreement with any Brit Director or, save for salary increases, bonuses or variations of terms in the ordinary course, any senior executive of the Brit Group;

(viii) proposed, agreed to provide or modified the terms of any share option scheme, incentive scheme, or other benefit (in any material respect) relating to the employment or termination of employment of any employee of the Wider Brit Group;

(ix) the trustees of the relevant pension scheme having since 31 December 2009 (I) proposed, made or agreed to any significant change to: (a) the terms of the trust deeds, rules, policy or other governing documents constituting any pension scheme or other retirement or death benefit arrangement established for the directors, former directors, employees or former employees of any entity in the Wider Brit Group or their dependants (a "Relevant Pension Plan"); (b) the basis on which benefits accrue, pensions which are payable or the persons entitled to accrue or be paid benefits, under any Relevant Pension Plan; (c) the basis on which the liabilities of any Relevant Pension Plan are funded or valued; (d) the manner in which the assets of any Relevant Pension Plan are invested; (e) the basis or rate of employer contribution to a Relevant Pension Plan; or (II) entered into or proposed to enter into one or more bulk annuity contracts in relation to any Relevant Pension Plan; or (III) carried out any act: (a) which would or could reasonably be expected to lead to the commencement of the winding up of any Relevant Pension Plan; (b) which would or might create a material debt owed by an employer to any Relevant Pension Plan; (c) which would or might accelerate any obligation on any employer to fund or pay additional contributions to any Relevant Pension Plan; or (d) which would or might give rise directly or indirectly to a liability in respect of a Relevant Pension Plan arising out of the operation of sections 38 to 56 inclusive of the Pensions Act 2004 in relation to the scheme;

(x) changed the trustee or trustee directors or other fiduciary of any Relevant Pension Plan; 

(xi) save in relation to any ordinary course underwriting profit sharing arrangements, implemented or effected, or authorised, proposed or announced its intention to implement or effect, any joint venture, asset or profit sharing arrangement, partnership, composition, assignment, reconstruction, amalgamation, commitment, scheme or other transaction or arrangement (other than the Offer) which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

(xii) purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or, save in respect of the matters mentioned in sub-paragraph (ii) above, reduced or, save in respect of the matters mentioned in sub‑paragraph (i) above, made any other change to any part of its share capital save for any changes made by any wholly-owned subsidiaries of Brit Insurance;

(xiii) waived, compromised or settled any claim otherwise than in the ordinary course of business which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

(xiv) save in connection with the matters mentioned in sub-paragraph (ii) above, made any material alteration to its articles of association or other incorporation documents;

(xv) taken or proposed any steps, corporate action or had any legal proceedings instituted or threatened against it in relation to the suspension of payments, a moratorium of any indebtedness, its winding‑up (voluntary or otherwise), dissolution, reorganisation or for the appointment of any administrator, receiver, manager, administrative receiver, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or appointed any analogous person in any jurisdiction or had any such person appointed;

(xvi) been unable, or admitted in writing that it is unable, to pay its debts or commenced negotiations with one or more of its creditors with a view to rescheduling or restructuring any of its indebtedness, or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business;

(xvii) entered into any contract, commitment, agreement or arrangement or passed any resolution or made any offer (which remains open for acceptance) with respect to or announced an intention to, or to propose to, effect any of the transactions, matters or events referred to in this Condition; or

(xviii) terminated or varied the terms of any agreement or arrangement between any member of the Wider Brit Group and any other person in a manner which would or might be expected to have a material adverse effect on the financial position of the Brit Group taken as a whole;

No material adverse change

17. since 31 December 2009, and except as fairly disclosed in the Half Year Financial Report or as publicly announced to a Regulatory Information Service by or on behalf of Brit Insurance or as fairly disclosed in writing by Brit Insurance to Achilles in each case before 26 October 2010:

(i) there having been no adverse change and no circumstance having arisen which is likely to be expected to result in any adverse change or deterioration in the business, assets, value, financial or trading position, profits, prospects or operational performance of any member of the Wider Brit Group to an extent which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings having been threatened, announced or instituted by or against or remaining outstanding against any member of the Wider Brit Group or to which any member of the Wider Brit Group is or may become a party (whether as claimant or defendant or otherwise) and no enquiry, review or investigation by, or complaint or reference to, any Third Party against or in respect of any member of the Wider Brit Group having been threatened, announced or instituted by or against, or remaining outstanding in respect of, any member of the Wider Brit Group which, in any such case, might reasonably be expected to have a material adverse effect on the Brit Group taken as a whole or in the context of the Offer;

(iii) no contingent or other liability having arisen, increased or become apparent which might be likely to adversely affect the business, assets, financial or trading position, profits, prospects or operational performance of any member of the Wider Brit Group to an extent which is material to the Brit Group taken as a whole or in the context of the Offer;

(iv) no steps having been taken and no omissions having been made which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider Brit Group, which is necessary for the proper carrying on of its business and the withdrawal, cancellation, termination or modification of which is material in the context of the Brit Group taken as a whole or in the context of the Offer;

18. since 31 December 2009, except as fairly disclosed in the Half Year Financial Report or as publicly announced to a Regulatory Information Service by or on behalf of Brit Insurance or as fairly disclosed in writing by Brit Insurance to Achilles in each case before 26 October 2010, Achilles not having discovered:

(i) that any financial, business or other information concerning the Wider Brit Group publicly announced or disclosed to any member of the Wider Achilles Group at any time by or on behalf of any member of the Wider Brit Group is misleading, contains a misrepresentation of fact or omits to state a fact necessary to make that information not misleading and which is, in any case, material in the context of the Brit Group as a whole or in the context of the Offer;

(ii) that any member of the Wider Brit Group is subject to any liability, contingent or otherwise, and which is material in the context of the Brit Group taken as a whole or in the context of the Offer; or

(iii) any information which affects the import of any information disclosed to Achilles at any time by or on behalf of any member of the Wider Brit Group which is material in the context of the Brit Group or in the context of the Offer; and

19. in relation to any release, emission, accumulation, discharge, disposal or other fact or circumstance which has impaired or is likely to impair the environment (including property) or harmed or is likely to harm human health, no past or present member of the Wider Brit Group, in a manner or to an extent which is material in the context of the Brit Group taken as a whole or in the context of the Offer, (i) having committed any violation of any applicable laws, statutes, regulations, notices or other requirements of any third party; and/or (ii) having incurred any liability (whether actual or contingent) to any third party; and/or (iii) being likely to incur any liability (whether actual or contingent), or being required, to make good, remediate, repair, re‑instate or clean up the environment (including any property).

Waiver of Conditions

Achilles reserves the right to waive in whole or in part all or any of Conditions 3 to 19 inclusive. Conditions 2 to 19 inclusive must be satisfied as at, or waived (where possible) on or before, midnight on the 21st day after the later of the first closing date of the Offer and the date on which Condition 1 is fulfilled (or, in each case, such later date as the Panel may agree). Achilles shall be under no obligation to waive or determine to be, or treat as, fulfilled, any of Conditions 3 to 10 inclusive by a date earlier than the date specified above for the fulfilment thereof, notwithstanding that the other Conditions of the Offer may at such earlier date have been waived or fulfilled, and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment. In any event, all of the Conditions must be satisfied as at, or waived (where possible) on or before midnight (London time) on the 81st day following the date on which the Offer Document is published or such other date as may be agreed with the Panel.

If Achilles is required to make a mandatory offer for Brit Shares under applicable Dutch law, Achilles may make such alterations to the terms and conditions of the Offer as are necessary to comply with the provisions of such law.

Further terms of the Offer

The Offer will lapse if the European Commission either initiates proceedings under Article 6(1)(c) of Council Regulation (EC) 139/2004 or makes a referral to a competent authority of the United Kingdom under Article 9(3)(b) of that Regulation and there is a subsequent reference to the UK Competition Commission, in either case before 1.00 p.m. (London time) on the first closing date of the Offer or the date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later. If the Offer so lapses, the Offer will cease to be capable of further acceptance and accepting Brit Shareholders and Achilles will cease to be bound by acceptances submitted before the time when the Offer lapses.

The Offer will be governed by English law and be subject to the exclusive jurisdiction of the English courts and to the Conditions.

Appendix 2SOURCES AND BASES OF INFORMATION

Unless otherwise stated in this announcement:

1. the value attributed to the Fully Diluted Share Capital is based on the Fully Diluted Share Capital of Brit Insurance being 80,796,214 Brit Shares which assumes that the obligations of Brit Insurance contained in the Implementation Agreement regarding options and awards under the Brit Share Schemes are complied with;

2. the value of the Proposal, assuming the maximum CVP of £0.25, the entitlement to receive £10.45 and the £0.30 Capital Distribution are payable, is based on:

(a) there having been 79,162,725 million Brit Shares in issue as of 22 October 2010 (the record date for the £0.30 Capital Distribution); and

(b) the Fully Diluted Share Capital of Brit Insurance on the basis described in paragraph 1 above;

3. the value of the Offer, assuming the maximum CVP of £0.25 and the entitlement to receive £10.45 is based on the Fully Diluted Share Capital on the basis described in paragraph 1 above;

4. the financial information relating to Brit Insurance is extracted from the audited consolidated financial statements of Brit Insurance for the relevant years, prepared in accordance with IFRS;

5. all prices for Brit Shares have been derived from the Daily Official List of the London Stock Exchange and represent Closing Prices on the relevant date(s); and

6. the average Closing Price per Brit Share of £7.66 for the six month period ended 10 June 2010 is derived from data provided by the Daily Official List of the London Stock Exchange.

Appendix 3DETAILS OF IRREVOCABLE UNDERTAKINGS

1. Independent Directors

The following Independent Directors have given irrevocable undertakings to accept the Offer and vote in favour of the Resolutions in respect of their own beneficial holdings (or those Brit Shares over which they have control) of Brit Shares as follows:

Matthew Scales has also given an irrevocable undertaking to accept the Offer or the proposals to be made by Achilles to holders of options and awards over 197,953 Brit Shares representing 0.25 per cent. of the existing issued share capital of Brit Insurance.

These irrevocable undertakings remain binding even in the event of a competing higher offer for Brit Insurance.

2. Managers

The Managers have given irrevocable undertakings to accept the Offer and vote in favour of the Resolutions (other than the Resolution approving the Management Arrangements on which they will not be entitled to vote) in respect of their own beneficial holdings (or those Brit Shares over which they have control) of Brit Shares as follows:

The Managers have also given irrevocable undertakings to accept the Offer or the proposals to be made by Achilles to holders of options and awards over a further 772,508 Brit Shares in aggregate representing 0.98 per cent. of the existing issued share capital of Brit Insurance.

These irrevocable undertakings remain binding even in the event of a competing higher offer for Brit Insurance.

Appendix 4DEFINITIONS

The following definitions apply throughout this document unless the context otherwise requires:

All references to "pounds", "£", "pence" and "p" are to the lawful currency of the United Kingdom.

All references to "Euros", "EUR" and "€" are to the lawful currency of the member states of the European Union that adopt a single currency in accordance with the Treaty Establishing the European Community as amended by the Treaty on the European Union.

For the purposes of this announcement, "subsidiary", "undertaking" and "subsidiary undertaking" have the meanings given by the Companies Act 2006, "associated undertaking" has the meaning given by paragraph 19 of Schedule 6 to the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 other than paragraph 19(1)(b) of Schedule 6 to those regulations which shall be excluded for this purposes, and "significant interest" means as direct or indirect interest in ten per cent. or more of the equity share capital (as defined in the Companies Act 2006).

All times referred to are London time unless otherwise stated.