Calera Capital (“Calera”), formerly Fremont Partners, and TPG Capital (“TPG,” formerly Texas Pacific Group) today announced the completion of the acquisition of Direct General Corporation (“Direct” or the “Company”) by an affiliate of Calera and TPG. Prior to the acquisition, Direct was a publicly traded company (NASDAQ: DRCT). The transaction was originally announced by the Company on December 5, 2006.

Under the terms of the transaction, Direct stockholders are entitled to receive $21.25 in cash for each share of common stock, without interest and less any withholding.

Headquartered in Nashville, the Direct group is a leading provider of non-standard personal automobile insurance, term life insurance, premium finance and other consumer finance products. Direct's subsidiaries distribute their products and serve their customers through over 500 company-owned retail stores in 13 states, primarily in the Southeast.

In conjunction with the closing of this acquisition, Direct has appointed Daniel Tarantin, 39, as Chief Executive Officer and a member of its board of directors. William Adair, the Company's current Chairman and CEO, has retired but will continue to serve on the Company’s board of directors.

Commenting on the acquisition, Mark Williamson, a Managing Partner of Calera Capital and the incoming Chairman of Direct, said, “We look forward to working in partnership with Direct's management team and TPG to build on the Company's strong foundation and to continue its profitable growth. Having worked with Dan for over two years, we are confident that he and his team can leverage Direct's store network and brand to better serve the Company’s customers.”

Added Marshall Haines of TPG, “TPG’s investment in Direct is consistent with our focus on creating value through change as we believe that working with Dan and his team we can make operational improvements in the business which will make Direct an even stronger and more valuable business. We have known Dan for a number of years and are similarly delighted to be working with him.”

Prior to joining Direct, Tarantin worked closely with Calera Capital to evaluate and identify investment opportunities that could benefit from his extensive experience in consumer finance, insurance, retail operations and cross marketing. Before partnering with Calera, Tarantin was a senior executive at Cendant Corporation for over ten years. At Cendant, Tarantin was most recently Vice Chairman of the Cendant Marketing Group and President and CEO of Progeny Marketing Innovations Inc., a leader in insurance and financial services, marketing through over 6,500 financial institutions. Previously he was President and CEO of Jackson Hewitt Tax Service, the 2nd largest paid tax return preparer in the U.S., and Vice President of Cendant Preferred Alliance Division, a group that developed marketing partnerships to leverage the value of Cendant's brands.

As is typical in Calera's and TPG's investments, the current management team will participate in the on-going ownership and success of the Company.

“The new partnership creates a great opportunity for our employees and our customers, and I am excited to be leading the Company into the next chapter of its successful development,” said Tarantin. “Calera and TPG are excellent partners and their experience in insurance, financial services, and retail businesses, together with their strong operational focus, will help Direct better serve its customers and become an even more profitable business.”

Direct’s stock will cease to trade on the NASDAQ Global Select Market at the close of market today and will be delisted. National City Bank has been appointed paying agent in connection with the merger and will be charged with mailing a letter of transmittal and instructions to all Direct stockholders of record. The letter of transmittal will provide instructions to stockholders on how to surrender their shares of Direct stock in exchange for the merger consideration.

David Lorsch and Mark Williamson led the deal team for Calera Capital, while Marshall Haines and Rick Schifter led the team for TPG.

About Calera Capital

Founded in 1991, Calera Capital, formerly known as Fremont Partners, is a private investment partnership which has managed more than $2 billion of equity investments in 23 companies, representing a total transaction value of $5.6 billion. With offices in San Francisco and Boston, Calera invests across a diverse range of industries, including financial services, business services, food and consumer, healthcare, building products, and industrial manufacturing. Calera Capital makes substantial equity investments in operating companies, typically with enterprise values up to $1 billion, and seeks to build long-term sustainable value by working with management teams to implement strategic and operating initiatives. More information can be found at www.caleracapital.com.

About TPG

TPG is a private investment partnership that was founded in 1992 and currently has more than $30 billion of assets under management. With offices in San Francisco, London, Hong Kong, New York, Minneapolis, Fort Worth, Melbourne, Menlo Park, Mumbai, Shanghai, Singapore and Tokyo, TPG has extensive experience with global public and private investments executed through leveraged buyouts, recapitalizations, spinouts, joint ventures and restructurings. TPG's investments span a variety of industries including financial services, healthcare, retail/consumer, airlines, media and communications, industrials, and technology. Please visit www.tpg.com.

About Direct General Corporation 

Direct General Corporation, headquartered in Nashville, Tennessee, is a financial services holding company whose principal operating subsidiaries provide non-standard personal automobile insurance, term life insurance, premium finance and other consumer products and services through neighborhood sales offices staffed primarily by employee-agents. The operations of Direct's subsidiaries are concentrated primarily in the southeastern part of the United States. Additional information about Direct General and its subsidiaries can be found online at www.directgeneral.com.

This release contains statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are subject to the safe harbor provisions of those sections and the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including those described in the Company's filings with the SEC, and that actual results or developments may differ materially from those in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis, judgment, belief or expectation only as of the date hereof. The Company has based these forward-looking statements on information currently available and disclaims any intention or obligation to update or revise any forward-looking statement.

For More Information, Contact:

For Calera Capital:

Michael Mandelbaum
(310) 785-0810 
michael@mandelbaummorgan.com

For TPG:
Owen Blicksilver
(516) 742-5950
owen@blicksilverpr.com

For Direct General:
William J. Harter
(901) 541-3399
bill.harter@directgeneral.com