Magazine article American Banker

Lehman to Form Group to Buy Conseco Finance

Magazine article American Banker

Lehman to Form Group to Buy Conseco Finance

Article excerpt

When Conseco Inc. put its consumer finance unit on the auction block two months ago it had help from longtime ally Lehman Brothers. But now that Lehman may be assembling a group that could buy the unit, Merrill Lynch & Co. is believed to have been named Conseco's new lead adviser. The two investment banks have a long history of involvement with Conseco, an insurance giant based in Carmel, Ind. Conseco's performance has stumbled badly since it paid $6.5 billion for Green Tree Financial Corp. in 1998 and made it into a consumer finance division that it is now trying to sell. Merrill represented Conseco in the purchase of St. Paul-based Green Tree, and Lehman advised Green Tree. But Conseco's stock has lost more than 90% of its value since the deal was announced as the market failed to support it. Announcing his decision to shed the unit in March, Stephen C. Hilbert, then the company's chairman, cited the finance unit's effect on the stock price. "It certainly has been a difficult two years for our fellow Conseco shareholders," he said. Lehman has signed a commitment letter to organize an investor group to buy the unit for $750 million, according to people familiar with the matter. Lehman may or may not be a part of the group, a source close to the investment bank said. Conseco retains the option to entertain other bids until the middle of June, said a source close to Conseco management. However, a source close to Lehman said there is no deadline in the commitment letter, which he said is nonbinding. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.