Gary Wendt announced yesterday that he was stepping down as the CEO of Conseco, the troubled Indianapolis-based financial services provider, but will remain as Board Chairman. Bill Shea, the current President and COO will replace him
Wendt has been at the forefront of efforts to rescue the company, which is saddled by an enormous debt load. It’s currently in discussions with its major creditors to restructure some $6 billion in debt. The talks are reportedly aimed at structuring a “prepackaged bankruptcy” that would give the creditors equity participation in exchange for their debt.
If the talks fail, most analysts expect that Conseco would have to file for bankruptcy. While Wendt, the former head of GE Finance who replaced Conseco founder Stephen Hilbert in June 2000, has managed to reduce the debt by over $2 billion, the company’s financial condition hasn’t improved. It posted a second quarter loss of $1.3 billion, and a federal investigation has been launched into its accounting procedures, which has also prompted the filing of several lawsuits by investors.
Some analysts have indicated that Wendt’s departure may facilitate a deal with the creditors.
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