Global Secured Capital L.L.C. and DLB Capital L.L.C. are joining to make a $52 million offer for Western United Life Assurance Company.
Global, Armonk, N.Y., and DLB, Wilton, Conn., have formed a limited liability company, Global Life Holdings L.L.C., to try to acquire Western United, Spokane, Wash., from the Washington state insurance commissioner’s office.
A court put Western United in receivership under the control of Washington state regulators in 2004, after the company’s parent, Metropolitan Mortgage & Securities Inc., Spokane, Wash., sought bankruptcy court protection.
Metropolitan Mortgage has no connection with MetLife Inc., New York.
Western United, a fixed annuity issuer, now has about $45 million in capital and surplus, Washington officials say.
Washington Insurance Commissioner Myron Kreidler has scheduled a May 2 hearing on the proposed deal.
Global and DLB say Global Life would try to rehabilitate Western United, keep the company in its current business and continue to support policyholders’ in-force annuities, officials say.
The deal could help make Western United’s preferred shareholders whole, and it could provide cash that the Metropolitan Mortgage bankruptcy trustee could use to help that company’s investors, officials say.
Several parties have expressed an interest in Western United since 2004, “but this is the first deal that makes sense and would make a significant return to equity holders,” Kreidler says.
Global and DLB say they would leave the current managers of Western United in place.
Douglas Brown, the founder of DLB, would run the Global Life management committee.
Before Brown founded DLB in 2007, he was vice chairman for investment banking at Morgan Stanley Inc., New York. He sits on the board of AEGON USA, a unit of AEGON N.V., The Hague, Netherlands, officials say.