ANGLO AMERICAN, WEAVERS SPLIT LONDON UNITED ENDS AGREEMENT

ANGLO AMERICAN, WEAVERS SPLIT LONDON UNITED ENDS AGREEMENT

Anglo American Insurance Co. has ceased advising H.S. Weavers (Underwriting) Agencies Ltd., the London-based casualty underwriting agent, after a management disagreement with Weavers' owners, London United Investments PLC.

London United said that it had terminated a management agreement with Anglo American Insurance Co., the London press reported this weekend.This leaves open the question of whether Weavers could still be acquired by Anglo American, as some expected soon after LUI's financial difficulties came to light last month.

John Head, chairman of the investment bank John Head & Partners LP, which owns Anglo American, was in meetings Monday and unavailable for comment.

However, he was quoted in published reports saying Anglo American would continue to honor and handle claims on insurance contracts written before Walbrook Insurance Co., another LUI subsidiary, was forced to cease underwriting and that he would be prepared to resume talks if London United were to change its position.

Anglo American was responsible for 45 percent of the business placed with Weavers, with the remaining 55 percent coming from Walbrook. Most of the business was liability risks, such as asbestosis and pollution, which can result in claims being made many years after the original policy was taken out. Many insurers have withdrawn from such risks because of such long-term exposure.

Peter Wilson, chairman of London United, was unavailable for comment Monday because of the European holiday. However, he was quoted in the British press during the weekend, saying negotiations with Anglo American had never reached the stage of discussing price.

On March 25 the U.K. Department of Trade and Industry ordered Walbrook to cease underwriting new business because of fears that Walbrook and several other LUI subsidiaries might not have sufficient reserves to meet claims.

Two days later Anglo American took over supervising the day-to-day operations of Weavers, leading to speculation that this would be followed by a takeover bid.

At that time it was said that John Cumming, chief executive of Anglo, would be available to Weavers in a general managerial capacity until a final decision was made on Weavers' future.