investment of $100 million in new Bermuda-based property catastrophe reinsurer Tempest Re.

A statement from the company said General Re will take a 20 percent stake in the company, which will have initial capital of $500 million and is expected to be in operation by October.

A General Re spokesman said he could not comment on who the other investors were likely to be, but confirmed the shares were being sold through a private placement.

He said there were no plans at present for the company to launch a public issue of stock, but said it could not be ruled out if the company decided to raise further capital.

The spokesman said the company's headquarters and operations would be based in Bermuda, but could not comment on what size the business would be.

The spokesman said that despite the formation of a number of other catastrophe reinsurance companies in Bermuda, it was believed that there was sufficient capacity because of the number of businesses which had left the sector.

The statement said Tempest was likely to contract with General Re for certain underwriting services and investment management.

No chief executive officer for the company has been named.

News of plans to form the company were first revealed in The Royal Gazette on Monday along with reports of plans to form as many as three other property catastrophe reinsurers.

Goldman Sachs and Johnson & Higgins are reported to be planning to form a company called Global Capital Re, while it is thought the pair may also be planning to form another firm called Renaissance Re capitalised at $100-200 million named Renaissance Re.

And Centre Re is also planning to form a property catastrophe company called Centre Cat, with capitalisation of $400 million.

The formations are likely to give added strength to Bermuda as an alternative insurance market to London or New York.