WL Ross Begins Assured Guaranty Deal

WL Ross & Co. has completed the first phase of its $1 billion investment in bond insurer Assured Guaranty Ltd. (NYSE: AGO). That piece involved the purchase of 10.7 million common shares at $23.47 per share, yielding $250 million in proceeds to the company. It gives Ross around a 12% ownership position.

 

ORIGINAL PRESS RELEASE

Assured Guaranty Ltd. (NYSE:AGO) (“Assured” or “the Company”) announced today that it has signed an agreement for WL Ross & Co. LLC (“WL Ross”) to purchase $250 million of common shares of Assured and to provide a commitment to purchase up to $750 million of additional common shares of Assured at the option of the Company. The closing of the initial $250 million investment is subject to regulatory approvals and other customary conditions. The closing of any subsequent investments will require shareholder approval, which the Company will request at its 2008 annual general meeting.

“We are extremely pleased that Wilbur Ross has chosen Assured as his preferred investment vehicle in the financial guaranty industry,” commented Dominic Frederico, President and Chief Executive Officer of Assured Guaranty Ltd. “This flexible capital source will allow us to continue to capitalize on the significant growth opportunities we see and will support our further expansion in both the direct and reinsurance markets.”

Wilbur Ross, Chairman and Chief Executive Officer of WL Ross & Co. LLC stated, We believe that Assured has an excellent opportunity during this time of uncertainty in the financial markets to provide investors with credit enhancement products in both the public and structured finance markets. We look forward to a long and profitable association with Assured.

The purchase price per common share for the initial investment will be the higher of (i) 97% of the average of $22.43 (the Company's NYSE closing price on Friday, February 22, 2008) and the average NYSE closing price for Friday, February 29, 2008 and Monday, March 3, 2008, or (ii) $21.76 (97% of $22.43). A condition to closing the initial investment is that Wilbur Ross, Chairman and Chief Executive Officer of WL Ross, will be appointed to the Company's Board of Directors.

The additional $750 million commitment by WL Ross is available at the option of the Company for one year from the date of the closing of the $250 million investment. The price for subsequent investments will be 97% of the volume weighted average price of the Company's common shares for the 15 trading days prior to notice of any subsequent investment. The ability of Assured to make a mandatory draw on the $750 million commitment is subject to (i) the subsequent investment price of Assured's common shares being no more than 17.5% above or below the price per common share of the initial investment, (ii) the maintenance of triple-A (stable) ratings for Assured Guaranty Corp. and double-A (stable) ratings for Assured Guaranty Re Ltd. from Standard & Poor's, Moody's and Fitch and the absence of material adverse changes in the credit quality of the Company's financial guaranty portfolio and investment portfolio from the most recently publicly disclosed information at the time of a drawdown.

Merrill Lynch & Co. acted as exclusive financial advisor to Assured on this transaction.

Assured Guaranty Ltd. is a publicly-traded Bermuda-based holding company. Its operating subsidiaries provide credit enhancement products to the U.S. and international public finance, structured finance and mortgage markets. More information on the Company and its subsidiaries can be found at www.assuredguaranty.com.