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TMCNet:  Atlas Financial Holdings Provides Update on Review by A.M. Best Co. Following Its Pending Acquisition

[November 14, 2012]

Atlas Financial Holdings Provides Update on Review by A.M. Best Co. Following Its Pending Acquisition

CHICAGO --(Business Wire)--

Atlas Financial Holdings, Inc. (TSX.V: AFH) ("Atlas" or the "Company") announced that as is customary upon the disclosure of a pending acquisition, A.M. Best Co. has placed Atlas and its subsidiaries under review. The financial strength rating of B (Fair) and issuer credit ratings (ICR) of "bb" of the statutory pool consisting of American Country Insurance Company ("American Country") and American Service Insurance Company, Inc. ("American Service") have been placed under review with negative implications.

The rating actions follow the Company's disclosure of a definitive agreement under which Atlas will acquire all of the issued and outstanding shares of Camelot Services, Inc. ("Camelot") and its wholly owned subsidiary, Gateway (News - Alert) Insurance Company ("Gateway"). A.M. Best Co.'s release indicates that the negative implications reflect the inherent risk associated with integrating Gateway's ongoing business into the Company's existing infrastructure, while overseeing the run off of Gateway's non-core lines, and the increase in financial leverage of Atlas as a result of funding the transaction, in part, with the issuance of preferred stock. A.M. Best Co. further stated that these risks are somewhat mitigated by Atlas' recent experience running off similar books of business as well as Gateway's current owner fully reinsuring all of Gateway's workers' compensaion related risk and providing additional adverse development protection as set out in the definitive purchase agreement. A.M. Best Co. has placed under review with developing implications the financial strength rating of B (Fair) and issuer credit rating of "bb" of Gateway.

"As demonstrated in our operating results subsequent to the acquisition of our existing subsidiaries, Atlas is well positioned to successfully execute the strategic activities necessary to refocus Gateway on its historically profitable lines of taxi and limo related insurance business which are core lines for the Company," commented Scott D. Wollney, President & CEO of Atlas "We are looking forward to the successful completion of this transaction based on the value we expect it to provide for Atlas customers, agents and policyholders."

About Atlas Financial Holdings, Inc.

The primary business of Atlas is commercial automobile insurance in the United States, with a niche market orientation and focus on insurance for the "light" commercial automobile sector including taxi cabs, non-emergency paratransit, limousine/livery and business auto. The business of Atlas is carried on through its insurance subsidiaries American Country Insurance Company and American Service Insurance Company, Inc. Atlas' insurance subsidiaries have decades of experience with a commitment to always being an industry leader in these specialized areas of insurance.

Forward-looking Statements

This release includes forward-looking statements regarding Atlas and its insurance subsidiaries and businesses. Such statements are based on the current expectations of the management of each entity. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or similar words are used to identify such forward looking information. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Companies, including risks regarding the insurance industry, economic factors and the equity markets generally and the risk factors discussed in the "Risk Factors" section of the Company's Form 10-K for the year ended December 31, 2011 . No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Atlas and its subsidiaries undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

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