NU Online News Service, June 5, 11:51 a.m. – Cobalt Corp., Milwaukee, has completed the sale of 3 million shares of stock from American Medical Security Group Inc., Green Bay, Wis., through a secondary public offering at a price of $18 per share.

The sale raised $51 million and reduced Cobalt’s stake in American Medical to 15% of the outstanding shares, from 39%.

The lead underwriters for the offering were CIBC World Markets Corp., New York; Robert W. Baird & Company, Milwaukee; and Stifel, Nicolaus & Company, St. Louis.

Cobalt, the Blue Cross and Blue Shield company for Wisconsin, once owned American Medical, a company that sells individual, family and small-group major medical coverage throughout the United States.

Cobalt turned American Medical into a separate, publicly traded company in 1998, but it continued to hold about 45% of American Medical’s stock.

Cobalt negotiated an agreement earlier this year to reduce its American Medical stake to 39% by selling 1.4 million American Medical shares back to American Medical.

Because of the arrangement with American Medical and the secondary public offering, Cobalt now owns less than 20% of American Medical’s stock. Cobalt can now account for its investment in American Medical as an ordinary investment and will no longer have to report American Medical’s earnings with its own statement of operations, Cobalt says.

Cobalt says it reduced its American Medical holdings so that it could focus on its core health insurance business.