Alleghany — Merger or Acquisition (November 2011)
17 slides from Alleghany's merger presentation, Nov 21, 2011
Slide 1: Alleghany Combination with Transatlantic
Exhibit 99.2 Alleghany Combination with Transatlantic November 21, 2011
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Cautionary Note Regarding Forward Looking Statements In addition to historical information, this document contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act o
Slide 3: Safe Harbor Disclosure
Safe Harbor Disclosure Alleghany and Transatlantic and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about Alleghany’s directors and e
Slide 4: Key Terms
Key Terms Merger of Transatlantic into a wholly owned subsidiary of Alleghany Transaction Stock portion is tax free Stock / cash election subject to proration 0.145 shares of Alleghany ($45.57) and $14.22 cash per Transatlantic share Consideration Implied offer price of $59.79 Total deal value of $3
Slide 5: Combination of Leading Specialty Franchises
Combination of Leading Specialty Franchises Alleghany Transatlantic Distinctive total return investment Top 10 global reinsurer strategy Best-in-class D&O, E&O and medical Business Premier excess & surplus lines insurer malpractice reinsurer Leading property cat writer Stockholders’ Equity: $2.8bn S
Slide 6: Alleghany—Profile
Alleghany—Profile Alleghany owns and manages operating subsidiaries and investments, anchored by a core position in P&C insurance Founded in 1929 and headquartered in New York, NY Total invested assets of $4.8bn ($ in millions) Book Value RSUI 1,410 Leader in excess & surplus lines insurance Low-ris
Slide 7: Alleghany—Corporate Philosophy
Alleghany—Corporate Philosophy Alleghany has a demonstrated track record of creating long-term stockholder value 2000 – 9M11 CAGR (%) 250.0 Alleghany Alleghany Focus on Book Value BVPS Price S&P 500 per Share Growth 8.8% 6.2% (0.8)% 200.0 Long-term Conservative 150.0 Orientation 100.0 Semi-autonomou
Slide 8: Alleghany—Superior Underwriting Performance
Alleghany—Superior Underwriting Performance RSUI: consistent performer – generated ~$1bn of underwriting profits since acquisition in July 2003 Capitol Transamerica: lower risk profile in specialty small commercial lines and surety Alleghany GAAP Combined Ratio versus Peer Average 120.0% 115.3% Alle
Slide 9: Alleghany—Proven Investment Performance
Alleghany—Proven Investment Performance Equity Portfolio Performance Alleghany S&P 500 Difference (%) (%) (% ppts) 2004 37.9 10.9 27.0 2005 35.3 4.9 30.3 2006 8.5 15.8 (7.3) 2007 19.2 5.5 13.7 2008 (31.4) (37.0) 5.6 2009 29.3 26.5 2.9 2010 17.1 15.1 2.0 (1) 2011 3.5 1.3 2.2 Cumulative 159.4 32.0 127
Slide 10: Transatlantic—Leading Global P&C Reinsurer
Transatlantic—Leading Global P&C Reinsurer Top 10 global P&C reinsurer by premiums 24 locations with local underwriters As of September 30, 2011: Provide customized products for many markets Stockholders’ Equity: $4.3bn Capital allocated to highest return geographies Capital and Surplus: $4.0bn High
Slide 11: Transatlantic—Leader in Specialty Classes of Reinsurance
Transatlantic—Leader in Specialty Classes of Reinsurance US Market Leader by Share and Reputation (1) 28.6% 28.1% 26.1% 24.7% Med Malpractice Claims Made 18.7% 16.3% 14.8% 12.3% 9.7% 9.6% Other Liability Claims Made 2006 2007 2008 2009 2010³ Professional Liability (2) #1 #1 #1 #1 #1 Flaspöhler Ranki
Slide 12: Transatlantic—Strong Catastrophe Risk Management
Transatlantic—Strong Catastrophe Risk Management Comprehensive approach to catastrophe risk Catastrophe Loss – % Property Premiums (1) management 24.2% 23.3% 19.8% Modeled loss: Current after-tax 15.7%14.9% 1-in-250 year event losses are below 20% of 12.8% stockholders’ equity 10.5%10.0% 9.9% 7.1% 6
Slide 13: Transatlantic—Consistent and Long-Term Book Value Creation
Transatlantic—Consistent and Long-Term Book Value Creation $77.13 $75.66 $6.83 $7.47 $66.78 $6.01 $55.09 $53.42 $4.53 $48.74 $5.23 $3.94 $42.29 $42.03 $38.86 $2.99 $3.43 $33.31 $2.62 $30.14 $30.23 $68.83 $69.67 $26.61 $2.28 $60.77 $1.67 $1.97 $1.39 $50.56 $48.19 $44.80 $39.30 $38.60 $36.24 $31.03 $2
Slide 14: Strategic Objectives for Transatlantic
Strategic Objectives for Transatlantic Combination with Alleghany Capital Management Meaningful combined excess capital with modest financial leverage Structural Flexibility Ability to redeploy capital across insurance platforms Insurance Operations Premier excess and surplus lines business EU Passp
Slide 15: Diversified Operating Portfolio
Diversified Operating Portfolio The combination provides a diversified pool of underwriting risk by product, geography and risk class through a shared focus on underwriting discipline By Product By Geography By Risk Class Traditional Insurance Casualty Insurance (Property) 13% (Casualty) 6% Domestic
Slide 16: Strong Combined Balance Sheet
Strong Combined Balance Sheet 7% accretive to BVPS to Alleghany Conservative financial leverage Increased investment float ($mm, unless otherwise noted) Alleghany Transatlantic Pro Forma (1) (2) Cash and Investments 4,760 13,682 17,484 Debt 299 1,006 1,305 (2) (3) Stockholders' Equity 2,804 4,075 5,
Slide 17: A Winning Combination
A Winning Combination Leading franchise across specialty insurance and reinsurance Combines disciplined underwriting with successful investing More diversified pool of underwriting risk, by product and geography Increased breadth of distribution Strong and deep management team Cultural fit expected