A state court in Thurston County, Wash., has given a joint venture formed by Global Secured Capital L.L.C. and DLB Capital L.L.C. permission to buy Western United Life Assurance Company for about $55 million.
The price is about $4 million higher than the price announced in April, officials say.
Global, Armonk, N.Y., and DLB, Wilton, Conn., are using Global Life Holdings L.L.C. to buy Western United, Spokane, Wash., from the Washington state insurance commissioner’s office.
A court put Western United in receivership under the control of the office 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.
Global Life originally proposed buying Western United for capital and surplus, or has agreed to add $2 million in cash and another $2 million from the future sale of real estate, according to Washington State Insurance Commissioner Myron Kreidler.
“The willingness of Global Life to amend its purchase price demonstrates its goodwill toward the parent companies and the Spokane community,” Kreidler says.
Global and DLB say Global Life will try to rehabilitate Western United, keep the company in its current business and continue to support policyholders’ in-force annuities, officials say.
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.
Under the terms of the sales agreement, “all current, outstanding shares of common and preferred stock of Western United will be redeemed and new shares will be issued to Global Life,” officials say.
Cash and other assets may go directly to Metropolitan Mortgage and the Western United holding company, officials say.
“Assets based on the value of capital and surplus at the date of the closing will be transferred to the creditors,” officials say. “The assets include $7 million in cash, $2 million from the future sale of a specific parcel of real estate, real estate valued at nearly $15 million, and approximately $31 million in reinsurance payments from Old Standard Life Insurance Company, a related company.”