business in Bermuda from November 16.

Bermuda's latest property catastrophe reinsurer will have a start-up capital of more than $350 million.

Mid Ocean Re will accept business from independent professional reinsurance intermediaries.

It is located in the Craig Appin building, in Hamilton, just across the road from the offices of insurance firm EXEL Ltd., which has invested $100 million in the new company.

EXEL has a 12-month contract to provide the initial support and administrative services to allow Mid Ocean Re to start operating immediately.

Mr. Ian Heap, Mid Ocean Re's president, said the firm hoped to take on this responsibility itself well within the 12-month period.

This would increase the number of staff from its current complement of five by about three, with the number of employees eventually rising to between 15 and 20.

There was great interest worldwide in the formation of Mid Ocean Re, said Mr.

Heap.

"This unquestionably will be treated by the business world and, particularly, the insurance industry as an event of great importance,'' he added.

"We're bringing in more than $350 million of new capital to a market where demand far exceeds supply.

"Mid Ocean Re is a new worldwide property catastrophe reinsurer with its headquarters and underwriting office in Bermuda.'' He likened the company's formation to the setting-up of other Bermuda-based insurance giants such as ACE, EXEL and Centre Re.

"There are similarities in that organisers J.P. Morgan and Marsh & McLennan saw an opportunity to fill a vacuum and bring in new capacity to a market where demand is outstripping supply,'' he said.

"I should also highlight the differences. ACE and EXEL was capitalised by its users or insureds, while Mid Ocean Re has been capitalised by outside private investment managers, such as pension funds.'' The initial plan was to raise $310 million, but Mid Ocean Re's offering was "significantly over subscribed'', said Mr. Heap.

"This shows the confidence in the venture,'' he added. "It's been met with an enormous amount of enthusiasm from the people who buy reinsurance and the brokers who place it because new capital is so badly needed.'' Mr. Heap will formally resign as chairman of EXEL at a board meeting this morning.

He is expected to be succeeded by Mr. Michael Kevany, who is currently EXEL's president and CEO.

While EXEL has provided $100 for Mid Ocean Re, J.P. Morgan and Marsh & McLennan have provided another $30 million each.

Other investors include Hawaiian-based Bishop Estates, which previously invested in Centre Re but liquidated its investment; Commercial Union, of London; Texas-based Rainwater, Inc.; Rolaco Holding S. A.; MBIA, Inc.; Fund American Enterprises Holdings; Crane Co.; Hellman and Friedman; and Miller Tabak Hirsch and Co.

The chairman of the board is Mr. Robert J. Newhouse, Jr., formerly president and vice chairman of Marsh & McLennan Companies, Inc.

Mr. Charles H.A. Skey will be underwriter for Mid Ocean Re for an initial period and had promised to make his services available for three years.

Mr. Skey was the underwriter for the R.A. Edwards Syndicate No. 219 at Lloyd's of London from 1962 to 1990 and is currently a director of CentreWrite.

Mr. Skey's eventual successor as underwriter for Mid Ocean Re is expected to be named soon.