Conseco Inc. has rejected an investment partnership’s proposal to increase its ownership share in the insurer.
Conseco, Carmel, Ind., declined to support the bid from Steel Partners II Ltd., New York, which wanted to raise its share of the company from 10% to as high as 22%. (See NU, May 26.)
In rejecting the proposal, Conseco contended that under IRS rules, it could lose valuable tax-loss carryovers if it underwent a significant “change of ownership.”
In addition, Conseco’s directors “believe it is inappropriate to give preference to one shareholder over others,” wrote Conseco CEO James Prieur in a letter to Steel Partners’ chairman John Howard.