Conseco looks to reduce, refinance existing $1.3 billion loan

By Sara Rosenberg

New York, Jan. 29 - Conseco Inc. plans to reduce and replace or renegotiate its existing $1.3 billion credit facility, according to an S-1 filing with the Securities and Exchange Commission on Thursday.

"We intend to reduce our overall senior indebtedness, reduce our borrowing costs and improve the terms and conditions of our existing bank credit facility," the filing said. "We believe that we can achieve these goals by using a portion of the proceeds of the offerings of our common stock and our Class B preferred stock to retire a portion of our existing debt, or by renegotiating the terms of our existing bank credit facility."

The company is looking to sell $800 million of common stock and $350 million of mandatorily convertible preferred stock.

Currently the company has a $1.3 billion facility comprised of a $1 billion term loan A and a $300 million term loan B. As of Sept. 30 the term A carried an interest rate of Libor plus 525 basis points with a 2% Libor floor and the term B carried an interest rate of Libor plus 725 basis points with a 2.25% Libor floor.

Conseco is a Carmel, Ind., provider of supplemental health insurance, life insurance and annuities.

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