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Conseco Details Plan to Raise Cash

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NU Online News Service, Jan. 29, 4:50 p.m. – Conseco Inc., Carmel, Ind., today announced actions it says it is taking to generate $750 million to $800 million in cash needed to meet 2002 debt obligations.

The actions include:

  • Repurchasing bonds at discount on the open market.
  • Reinsuring parts of the supplemental health and life insurance blocks of business.
  • Selling the variable annuity business.
  • Finding a joint venture partner for the manufactured housing floorplan business.
  • Expanding a bank line at Conseco Finance Corp.
  • Doing whole loan sales on some home equity and home improvement receivables.
  • Selling non-core assets.

Gary Wendt, Conseco chief executive, reports in a memorandum that Conseco has already received bids for the VA unit and expects to announce a deal by March 31.

The unit is a poor fit for middle-market Conseco customers, and it has failed to meet Conseco return expectations, Wendt says.

Wendt says negotiations for the reinsurance transactions are well along. He did not name the reinsurers involved.