White Mountains Sells Block of Montpelier Shares

March 15, 2004

White Mountains Insurance Group, Ltd. And Prospector Partners, LLC’s on again off again sale of 4,785,540 common shares of Montpelier Re Holdings Ltd. (See IJ Website Mar.10 and 12) has been resolved by a block sale of the shares to Banc of America Securities LLC and Morgan Stanley & Co. Inc.

The sale price was $34.50 per share. White Mountains indicated that Banc of America and Morgan Stanley have offered the shares to the public at a price of $35.50 per share.

“Notwithstanding the block trade, White Mountains’ beneficial ownership of shares of Montpelier will only decline to 13,472,357.5, as White Mountains has also indicated it intends to purchase currently exercisable warrants to acquire 2,390,785.8 shares of Montpelier from an existing warrantholder on March 15, 2004,” said the announcement.

Montpelier did not sell any common shares in connection with the transaction and did not receive any proceeds.

White Mountains also noted that “this transaction is being made in connection with an internal restructuring of its business and that, together with additional steps White Mountains may take, a change in the treatment of its Montpelier investment under US generally accepted accounting principles may result. White Mountains has further indicated that, after giving effect to both the sale of the shares and the acquisition of the warrants, its fully converted ownership percentage of Montpelier common shares will be approximately 18.4 percent.”

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