Endurance Specialty Holdings to Acquire Montpelier Re Holdings

Increases Endurance's Scale and Market Presence

Broadens Capabilities Through Addition of Lloyd's Franchise

Adds Established Third Party Capital Management Franchise

Accretive to Endurance Earnings Per Share and Return on Equity

PEMBROKE, Bermuda, March 31, 2015 - Endurance Specialty Holdings Ltd. (NYSE: ENH) ("Endurance" or the "Company") and Montpelier Re Holdings Ltd. (NYSE: MRH) ("Montpelier") today announced that they have entered into a definitive merger agreement pursuant to which Endurance will acquire Montpelier for consideration of 0.472 shares of Endurance and $9.89 in cash for each Montpelier common share, which represents $40.24 per Montpelier common share, or $1.83 billion in aggregate, based on Endurance's closing price on March 30, 2015. 

John R. Charman, Endurance's Chairman and Chief Executive Officer, said, "Endurance's strategic acquisition of Montpelier represents a compelling value creation opportunity for Endurance's shareholders, with accretion to earnings per share and return on equity.  As a result of the transaction, we expect to achieve meaningful transaction synergies through cost savings and greater capital efficiencies.  Importantly, the acquisition materially increases our breadth of distribution with the addition of a good-sized and scalable Lloyd's platform and an attractive property catastrophe business that complements our existing reinsurance portfolio.  The acquisition also provides Endurance with a natural introduction to the business of managing insurance and reinsurance investment products for third-party capital investors.  Montpelier's historic high quality portfolio reflects a disciplined approach to underwriting that is consistent with Endurance's strong risk management and underwriting culture." 

Under the terms of the agreement, the aggregate consideration for the transaction will consist of $450 million in cash and approximately 21.5 million Endurance ordinary shares, which are valued at approximately $1.4 billion based on Endurance's closing price on March 30, 2015.  The cash portion of the consideration will be funded through a pre-closing dividend paid by Montpelier to its common shareholders.  Following completion of the transaction, Montpelier's existing shareholders will own approximately 32% of Endurance's outstanding ordinary shares.