Scottish Holdings, Salic third amended reorganization plan confirmed

By Caroline Salls

Pittsburgh, Aug. 29 – Scottish Holdings, Inc. and Scottish Annuity & Life Insurance Co.’s (Salic) third amended plan of reorganization was confirmed on Monday, according to an order filed with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, Scottish Holdings obtained court approval in June of the designation of Hildene Re Holdings, LLC as the winning bidder to serve as plan sponsor.

Hildene’s winning bid includes a $21.5 million plan-funding amount.

The plan provides for the reorganization and recapitalization of the debtors and certain of their non-debtor Affiliates through a new-money contribution of $12.5 million in the form of a recapitalization funding payment and the funding of distributions to creditors through an additional $21.5 million new-money payment.

In exchange for the payments and other consideration, the sponsor will receive 100% of the new equity, subject to downward adjustment to no less than 70% to the extent eligible unsecured creditors elect to receive their share of up to 30% of the new equity in lieu of a cash distribution.

The plan also calls for the assumption by the reorganized debtors of Salic net worth maintenance agreements and all or substantially all reinsurance treaties for which Salic acts as reinsurer and the creation of a distribution trust.

Holders of secured claims will have their claims reinstated or paid in cash.

Existing Salic equity interests will be treated in accordance with a stock purchase agreement, share issuance documents, share surrender documents and a restructuring implementation agreement.

Scottish Holdings equity interests will be cancelled and reissued at the discretion of the sponsor.

Holders of TruPS can elect to receive an equity or cash distribution, as well as proceeds from trust assets.

Scottish Re Group Ltd. is a Hamilton, Bermuda-based life reinsurance company. Its Cayman Islands and U.S. subsidiaries filed bankruptcy on Jan. 28, 2018 under Chapter 11 case number 18-10160.

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