A.M. Best Assigns Rating to Markel Corporation's Issuance of Senior Notes

• Press Release
• Source: A.M. Best Co.
• On 1:30 pm EDT, Wednesday September 23, 2009

OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best Co. has assigned a debt rating of “bbb+” to the new issuance of $350 million 7.125% 10-year senior unsecured notes, due 2019 of Markel Corporation (Markel) (Richmond, VA) (NYSE: MKL - News). The assigned outlook is stable. Proceeds from the current offering will be used for general corporate purposes, including acquisitions.

Related Quotes

Symbol	Price	Change
MKL	328.89	-0.31

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At June 30, 2009, Markel’s debt-to-capital stood at 24%, generally consistent with levels maintained over the last few years. With the inclusion of Markel’s $350 million senior notes issuance and reflecting the $150 million repayment of the remaining balance owed on its revolving bank line of credit earlier in third quarter 2009, the company’s proforma debt to capital as of September 30, 2009 will be 27.5%, well within the range of financial leverage A.M. Best has established for similarly-rated holding companies.

It is expected that some of the capital raised will be used to fund the acquisition of Elliot Special Risks, a leading managing general agency in Canada, for approximately CAD 75 million, in a deal that is expected to close on October 1, 2009.

While the competitive property/casualty operating environment places pressure on 2009 underwriting results and it is still possible that there will be further volatility in the investment markets, A.M. Best believes strong operating fundamentals will allow Markel to post solid operating results. A.M. Best also expects improved operating results to further enhance the company’s interest and fixed charge cash coverage ratios.

For Best’s Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

A.M. Best Co.
Analysts:
David S. Blades, CPCU, 908-439-2200, ext. 5422
david.blades@ambest.com
or
Joseph Roethel, 908-439-2200, ext. 5630
joseph.roethel@ambest.com
or
Public Relations:
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com