NEW YORK (Standard&Poor's) April 2, 2008--Standard&Poor's Ratings Services said today that it affirmed its 'BBB-' counterparty credit rating on Argonaut Group Inc. (AGI), a wholly owned subsidiary of Argo Group International Holdings Ltd. (NASDAQ:AGII), and its 'A-' counterparty credit and financial strength ratings on AGI's insurance company affiliates (collectively referred to as Argonaut). Standard&Poor's also said that the outlook on AGI and Argonaut remains negative. The affirmations follow the announcement that Peleus Reinsurance Ltd. (Peleus), a Bermuda-domiciled subsidiary of AGII, intends to acquire Heritage Underwriting Agency plc, a publicly traded Lloyds syndicate manager, for approximately $279 million. AGII will fund the purchase internally, with AGI providing a significant portion of the funds using cash
