Zurich Prices Share Offering at $43.75

October 11, 2002

Zurich Financial Services (ZFS) announced the price of the 57.6 million new shares it intends to issue in a two-for-three rights offering will be SwF 65 ($43.75) per share, giving current holders a prima facia discount of 50 percent.

The company’s shareholders approved the $2.5 billion share increase at a special meeting held today.

ZFS hopes to raise as much as $5 billion in new capital, half of it through the rights issue. The new shares, however, will reduce the actual discount for existing shareholders to around 38 percent, based on ZFS recent share price which has been in the SwF 130 ($87.50) range.

Analysts’ reaction to the announcement and the overall restructuring plan put in place by CEO Jim Schiro, who replaced Rolf Hüppi last May, was generally favorable. ZFS has suffered from a rising debt load, and the fall in asset values on global stock markets. Its shares have fallen more than 65 percent in value so far this year on top of a 60 percent decline in 2001.

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