Marsh & McLennan Companies said
its money manager Putnam Investments may report a $10 million to
$15 million reduction in pretax income from operations in the
third quarter because of an investment in Conseco Inc.
Through Putnam’s investment in Thomas H. Lee Partners LP,
Putnam may be hurt by Conseco’s inability to make some bond
payments and a possible restructuring of the insurance and finance
company’s $6.5 billion in debt, according to a quarterly filing
with the Securities and Exchange Commission today.
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Thomas H. Lee, the Boston buyout firm, made one of the
biggest bets on Conseco by investing $500 million in Conseco’s
preferred shares in 1999. Also that year, Putnam acquired an
equity interest in Thomas H. Lee.
Gary Wendt, former head of GE Capital Corp., became chairman
and chief executive of Conseco in 2000 and vowed to turn around
the struggling insurer. Conseco said Friday his turnaround plan
has failed. Stock in Carmel, Indiana-based Conseco has plunged 98
percent this year and has been suspended from trading on the New
York Stock Exchange.
Marsh & McLennan spokeswoman Barbara Perlmutter and Thomas H.
Lee spokesman Greg Miller declined to comment.
Bloomberg News
