Moody's affirms Alleghany

Moody's Investors Service said it affirmed its Baa2 senior unsecured debt rating of Alleghany Corp., as well as the A3 insurance financial strength ratings of RSUI Indemnity Co. and Landmark American Insurance Co., following the company's joint announcement today with Transatlantic Holdings of a definitive agreement between the companies that Alleghany would acquire all of the outstanding shares of TRH for about $3.4 billion.

The outlook f remains stable.

According to Moody's, the rating affirmation is based on the following key considerations: (a) Alleghany's pro forma financial flexibility profile remaining within expectations at the current rating level, with greater overall capital resources and a broader shareholder and creditor base; (b) Moody's expectation that integration risk is modest, given the distinct business operations and expected management continuity at the core operating units; (c) the structural subordination of Alleghany's creditors to those of TRH; (d) benefits of diversification for Alleghany that are nevertheless mitigated by correlations between the fundamental business; and (e) a continued strong holding company liquidity profile.

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