Merchants Group,
Inc.
250 Main Street,
Buffalo, New York 14202
For Immediate
Release
Contact: Thomas E. Kahn
Telephone: (314) 421-4600
***AMERICAN EUROPEAN
GROUP TO ACQUIRE
MERCHANTS GROUP, INC.***
November 1, 2006,
Buffalo, N.Y. - American European Group, Inc. ("AEG") and Merchants
Group, Inc. (AMEX:MGP) announced today that they have signed a
definitive agreement whereby AEG will acquire Merchants Group for
$70.8 million in cash. The transaction was unanimously
approved by Merchants Group's board of directors.
Commenting on the
transaction, Thomas Kahn, Chairman of the Board of Directors of
Merchants Group stated, "The transaction with American European
Group affords an opportunity for the shareholders of Merchants
Group to realize liquidity at a fair value. Since early 2005,
Merchants Group has been exploring strategic alternatives, and on
behalf of the board, we are delighted to have entered into this
agreement with AEG."
Nachum Stein, President
and CEO of American European Group stated, "American European Group
is pleased to enter into this transaction with Merchants Group and
is looking forward to the opportunities afforded by this
transaction."
Under
