Mr. Pink,
if they don't believe you, they may read the piece from the Street, with comments from Colin Devine at the bottom:
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These two loans now mature at the same time as a $766 million credit, also led by Bank of America, taking the total that Conseco needs to immediately restructure to $1.07 billion. Chase declined to comment and Bank of America didn't return a call.
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Conseco's banks probably want to get as much of their money repaid as possible without crippling the company. In fact, the banks may have to extend up to half of the $1.07 billion. However, it's hard to see the banks going beyond a nine-month extension, because they'll likely want full repayment before $670 million in bond debt that comes due in June 2001.
Conseco's parent company, the focus of the concerns about cash-flow, has obligations totaling $8.6 billion, including a further $2 billion in debt guarantees, according to Colin Devine, an insurance analyst with Salomon Smith Barney. (He rates Conseco a hold, and Salomon has underwritten Conseco securities.) Devine remarks in a recent research note that, absent a big injection of capital, Conseco "can struggle through" to the end of 2001's first quarter, after which a "crunch will come."
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thestreet.com |
