PXRE and Argonaut to merge

HAMILTON, Bermuda— Bermuda-based PXRE Group Ltd. and San Antonio, Texas-based Argonaut Group Inc. are to merge, the companies announced.

The merged companies will do business as Argo Group International Holdings Ltd., they said.

Argo Group will become the Bermuda-based holding company for PXRE's existing insurance subsidiaries, Argonaut's U.S. operations and a newly formed Bermuda-based reinsurer Peleus Reinsurance Ltd.

Mark E. Watson, president and chief executive officer of Argonaut Group will serve as president and CEO of the new entity.

Separately, PXRE announced a loss of $19.7 million for the fourth quarter of 2006, compared with a loss of $446.5 million for the same period in 2005.