Washington Insurance Commissioner Mike Kreidler led the closing signing at the Davenport Hotel in Spokane. He also personally thanked Western United employees at company headquarters for all of their hard work during his four-year receivership of the insurer.
“Today’s sale of Western United is a great outcome for the company and for the larger Spokane community,” said Kreidler. “I was confident we could reach our common goals of protecting policyholders, improving the financial stability of the company, preserving a viable insurer in Spokane, and providing a significant return to investors who suffered because of the bankruptcy of Metropolitan Mortgage. I am grateful for the hard work and dedication of all those involved in this successful rehabilitation. Today, Western United returns to private operation and faces a bright future.”
Under the sale agreement:
- All current, outstanding shares of common and preferred stock of Western United will be redeemed and new shares will be issued to Global Life.
- Cash and assets may go directly to Metropolitan and to Western United Holding Company.
- Capital and surplus of $52,467,834 was transferred to the creditors. The assets included almost $5 million in cash, real estate valued at nearly $15 million and approximately $33 million in reinsurance payments from Old Standard Life Insurance Company, a related company. Creditors will receive an additional payment of up to $2 million if a specific parcel of real estate is sold in the future. Assets to be transferred are valued according to statutory accounting principles which may be less than Generally Accepted Accounting Principles (GAAP) or market value.
Kreidler was granted receivership of Western United in March 2004 in order to protect the company and its policyholders from the bankruptcy of its parent company, Metropolitan Mortgage & Securities Inc.