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Subject: Conseco in 3rd largest Chapter 11 filing Author: budfox [ Next Thread | Previous Thread | Next Message | Previous Message ] Date Posted: 18:20:56 12/19/02 Thu Conseco in 3rd largest Chapter 11 filing CONSECO Inc, which became one of the biggest US insurers by acquiring rivals in the 1990s, filed for bankruptcy protection after a 30-month struggle to stay in business with more than US$6 billion of debt. It is the third-largest Chapter 11 filing after WorldCom Inc and Enron Corp. Conseco's purchase of mobile-home lender Green Tree Financial Corp in 1998 left it saddled with losses. The company has posted six consecutive quarterly losses as customers missed debt payments and slumping stock markets led to investment losses. The move ends attempts begun by former General Electric Capital Corp chief executive Gary Wendt to reverse a strategy that led to the ouster of founder Stephen Hilbert. 'It shows how hard it is to turn a company around when it starts to go south,' said Rick Rickertsen, chief operating officer of buyout firm Thayer Capital Partners in Washington. 'At one point, they were in the money and it looked like one of the greatest turnarounds.' Conseco bought the largest US mobile-home lender for US$6 billion. But the purchase dragged down Conseco's financial performance as borrowers refinanced at lower rates, contributing to a US$350 million loss in 1999. 'The beginning of the end was when they bought Green Tree,' said Kevin Callahan at Boston-based Century Funds. 'For a while it was one of the best stocks; after Green Tree it's been one of the worst.' In court documents, Carmel, Indiana-based Conseco listed US$52.3 billion in assets and US$51.2 billion in debts. Conseco has agreed to sell its Conseco Finance Corp business to an investment group. The purchase price will equal the outstanding secured debt of Conseco Finance, the company said in a statement. Conseco Finance was included in the bankruptcy filing. - Bloomberg Feedback [ Next Thread | Previous Thread | Next Message | Previous Message ]