On The Block: Conseco to Shed Finance Business

In another case of undoing an expensive acquisition gone bad, Conseco Inc. put its manufactured home finance business up for sale after suffering a two-year battering of its stock price because of investor distaste for the deal. The operation, known as Green Tree Financial Corp. when it was purchased for a whopping $6 billion, will be marketed by Lehman Brothers. Conseco, a frequent acquirer of insurance companies, had hoped to sell the deal as offering a synergistic financial service to customers. But investors didn’t buy the tie-in or Green Tree’s controversial accounting practices, which later were revised to more traditional methods. Conseco stock closed March 31 on the New York Stock Exchange at 11-7/16 compared with a 52-week range of 11-11/16 to 35-5/16. Other companies announcing strategic assessments in March: Southdown Inc., the second-largest U.S. cement producer and one of the last major American-owned firms in the industry, arguing that its stock price doesn’t reflect its intrinsic value after numerous operating improvements, enlisted Lehman Brothers to check out options for enhancing shareholder value. The menu of possibilities includes a share buyback, acquisitions, and a sale of the company. Mossimo Inc., an apparel maker which has been running in the red, retained Wasserstein Perella to advise on strategic alternatives as it revealed a series of licensing initiatives to boost income. Manor Care Inc., a nursing home operator, was reviewing a possible sale and other alternatives with the help of Warburg Dillon Read. Crown Pacific Partners LP, a forest products company dismayed over its stock price, hired Warburg Dillon Read to explore strategic alternatives. Southwest Securities Group Inc., an investment and financial services firm which acknowledged that its growth is “stretching our resources,” assigned Bear Stearns to advise on strategic alternatives. Monarch Dental Corp., a manager of dental practices, retained Bank America Securities to explore strategic alternatives, including a possible sale. Flanders Corp., a manufacturer of air filtration products, engaged PaineWebber to explore strategic alternatives, including “a potential sale of the company.” Haven Bancorp, a Long Island-based bank, engaged Lehman Brothers for advising on strategic alternatives. The results of previously announced strategic reviews by major companies: Dole Food Co., which was working with Goldman, Sachs, decided not to sell the fruit and vegetable company. WestPoint Stevens Inc. directors approved a $22-a-share, or $1.2 billion, offer from a group led by Holcombe T. Green Jr., CEO of the manufacturer of sheets and towels. It had been advised by Merrill Lynch. Montana Power Co. decided to divest its utility business and retain its Touch America telecom operations. Snyder Communications Inc., an advertising and marketing firm which was advised by Deutsche Banc Alex. Brown, agreed to be acquired by Havas Advertising for $2.1 billion. Crown Central Petroleum, which was advised by Credit Suisse First Boston, was the target of a bidding contest by leading stockholders. The refining and marketing company finally agreed to a $9.50-a-share offer from its controlling shareholder, Rossmore Corp., which beat out Apex Oil. Ballantyne of Omaha Inc., a producer of movie projectors and theatrical lighting equipment, scrubbed the review conducted with Donaldson Lufkin Jenrette. Staff Leasing Inc., a professional employment organization, said a special committee concluded that its “best available alternative” was to remain an independent, public company. Healthcare Recoveries Inc., which reco-vers claims for insurers and health care companies, took itself off the market.