sc13da401874127_05192008.htm

0000921895-08-001468.txt : 20080519 0000921895-08-001468.hdr.sgml : 20080519 20080519133458 ACCESSION NUMBER: 0000921895-08-001468 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20080519 DATE AS OF CHANGE: 20080519 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CONSECO INC CENTRAL INDEX KEY: 0001224608 STANDARD INDUSTRIAL CLASSIFICATION: ACCIDENT & HEALTH INSURANCE [6321] IRS NUMBER: 753108137 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-79240 FILM NUMBER: 08844637 BUSINESS ADDRESS: STREET 1: 11825 N PENNSYLVANIA ST CITY: CARMEL STATE: IN ZIP: 46032 BUSINESS PHONE: 3178176100 MAIL ADDRESS: STREET 1: 11825 NORTH PENNSYLVANIA STREET CITY: CARMEL STATE: IN ZIP: 46032 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: STEEL PARTNERS II LP CENTRAL INDEX KEY: 0000915653 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 590 MADISON AVENUE STREET 2: 32ND FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-758-3232 MAIL ADDRESS: STREET 1: 590 MADISON AVENUE, 32ND FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 FORMER COMPANY: FORMER CONFORMED NAME: STEEL PARTNERS II L P DATE OF NAME CHANGE: 19950627 SC 13D/A 1 sc13da401874127_05192008.htm sc13da401874127_05192008.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 4)1

Conseco, Inc.

(Name of Issuer)

Common Stock, par value $0.01

(Title of Class of Securities)

208464883

(CUSIP Number)

STEVEN WOLOSKY, ESQ.

OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP

Park Avenue Tower

65 East 55th Street

New York, New York 10022

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

May 19, 2008

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

_______________

1 The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON STEEL PARTNERS II, L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 18,144,661
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 18,144,661
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 18,144,661
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.8%
14	TYPE OF REPORTING PERSON PN

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON STEEL PARTNERS II GP LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 18,144,661
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 18,144,661
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 18,144,661
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.8%
14	TYPE OF REPORTING PERSON OO

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON STEEL PARTNERS II MASTER FUND L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION CAYMAN ISLANDS
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 18,144,661
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 18,144,661
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 18,144,661
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.8%
14	TYPE OF REPORTING PERSON PN

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON STEEL PARTNERS LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 18,144,661
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 18,144,661
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 18,144,661
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.8%
14	TYPE OF REPORTING PERSON OO

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON WARREN G. LICHTENSTEIN
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 18,144,661
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 18,144,661
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 18,144,661
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.8%
14	TYPE OF REPORTING PERSON IN

CUSIP NO. 208464883

1	NAME OF REPORTING PERSON JACK L. HOWARD
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER - 0 -**
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER - 0 -**
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON - 0 -**
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) - 0 -**
14	TYPE OF REPORTING PERSON IN

** See Item 5.

CUSIP NO. 208464883

The following constitutes Amendment No. 4 to the Schedule 13D filed by the undersigned (“Amendment No. 4”). This Amendment No. 4 amends the Schedule 13D as specifically set forth.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended and restated to read as follows:

The aggregate purchase price of the 18,144,661 Shares owned by Steel Partners II is approximately $259,106,437, including brokerage commissions. The Shares owned by Steel Partners II were acquired with partnership funds.

Steel Partners II effects purchases of securities primarily through margin accounts maintained for it with prime brokers, which may extend margin credit to it as and when required to open or carry positions in the margin accounts, subject to applicable federal margin regulations, stock exchange rules and the prime brokers’ credit policies. In such instances, the positions held in the margin accounts are pledged as collateral security for the repayment of debit balances in the accounts.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended to add the following:

On May 19, 2008, Steel Partners II delivered a letter to the Issuer expressing its interest in purchasing, with the Issuer’s support, additional Shares without exceeding ownership in excess of 22% of the outstanding Common Stock. Steel Partners II believes, based on the Issuer’s public filings, that it can increase its percentage ownership up to 22% of the outstanding Common Stock without limiting the Issuer’s ability to fully realize the benefits of its net operating loss carryforwards. Steel Partners II is not permitted to acquire 10% or more of the outstanding Shares without first complying with applicable insurance holding company filing requirements. Steel Partners II requested the Issuer to advise the insurance regulators that it will not object to Steel Partners II’s increased ownership when contacted by the regulators. Steel Partners II also stated that it believes the Board has been slow to implement the strategic review process and that return on equity of Conseco Insurance Group is inadequate and needs to be improved as quickly as possible. A copy of this letter is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 5.

Interest in Securities of the Issuer.

Item 5(a) is hereby amended and restated to read as follows:

(a) The aggregate percentage of Shares reported owned by each person named herein is based upon 184,655,525 Shares outstanding, which is the total number of Shares outstanding as of April 29, 2008 as reported in the Issuer’s quarterly report on Form 10-Q filed with the Securities and Exchange Commission on May 9, 2008.

As of the close of business on May 16, 2008, Steel Partners II beneficially owned 18,144,661 Shares, constituting approximately 9.8% of the Shares outstanding. By virtue of their relationships with Steel Partners II discussed in further detail in Item 2, each of Steel GP LLC, Steel Master, Partners LLC and Warren G. Lichtenstein may be deemed to beneficially own the Shares owned by Steel Partners II.

CUSIP NO. 208464883

Jack Howard does not directly own any Shares. Mr. Howard, as a member of a “group” for the purposes of Rule 13d-5(b)(1) of the Securities Exchange Act of 1934, as amended, may be deemed to beneficially own the 18,144,661 Shares owned by Steel Partners II. Mr. Howard disclaims beneficial ownership of such Shares.

Item 5(c) is hereby amended to add the following:

(c) Schedule A annexed hereto lists all transactions in the Shares by the Reporting Persons since the filing of Amendment No. 3 to the Schedule 13D. All of such transactions were effected in the open market.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item 6 is hereby amended to add the following:

As of the close of business on May 16, 2008, Steel Partners II did not own any derivative securities of the Issuer.

Item 7.

Material to be Filed as Exhibits.

Item 7 is hereby amended to add the following exhibit:

99.1 Letter to the Issuer, dated May 19, 2008.

CUSIP NO. 208464883

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: May 19, 2008	STEEL PARTNERS II, L.P.

	By:	Steel Partners II GP LLC General Partner

	By:	/s/ Lauren Isenman
		Lauren Isenman as Attorney-In-Fact for Warren G. Lichtenstein, Managing Member

	STEEL PARTNERS II GP LLC

	By:	/s/ Lauren Isenman
		Lauren Isenman as Attorney-In-Fact for Warren G. Lichtenstein, Managing Member

	STEEL PARTNERS II MASTER FUND L.P.

	By:		Steel Partners II GP LLC General Partner

	By:	/s/ Lauren Isenman
		Lauren Isenman as Attorney-In-Fact for Warren G. Lichtenstein, Managing Member

	STEEL PARTNERS LLC

	By:	/s/ Lauren Isenman
		Lauren Isenman as Attorney-In-Fact for Warren G. Lichtenstein, Manager

	/s/ Lauren Isenman
	LAUREN ISENMAN as Attorney-In-Fact for Warren G. Lichtenstein

	/s/ Jack L. Howard
	JACK L. HOWARD

CUSIP NO. 208464883

SCHEDULE A

Transactions in the Securities of the Issuer Since the Filing of Amendment No. 3 to the Schedule 13D

Class of

Security

Securities

Purchased

Price ($)

Date of

Purchase

STEEL PARTNERS II, L.P.

Common Stock	100,000	10.3777	03/25/08
Common Stock	100,000	10.4929	03/25/08
Common Stock	100,000	10.4844	03/25/08
Common Stock	100,000	10.4053	03/26/08
Common Stock	500,409	10.5756	03/26/08
Common Stock	8,211	10.4678	04/25/08
Common Stock	41,300	10.6570	04/25/08
Covered Short Put Position ($10.00 Strike Price)	3,010	0.4500	04/28/08
Common Stock	115,300	10.9022	04/28/08
Common Stock	300	11.0000	04/30/08

STEEL PARTNERS II GP LLC

None

STEEL PARTNERS II MASTER FUND L.P.

None

STEEL PARTNERS LLC

None

WARREN G. LICHTENSTEIN

None

JACK L. HOWARD

None

EX-99.1 2 ex991sc13da401874127_051908.htm ex991sc13da401874127_051908.htm

Exhibit 99.1

STEEL PARTNERS II, L.P.

590 Madison Avenue, 32nd Floor

New York, New York 10022

May 19, 2008

For Dissemination to Board of Directors

Conseco, Inc.

11825 N. Pennsylvania Street

Carmel, Indiana 46032

Attn: Corporate Secretary

Dear Members of the Board:

As you know, we are one of the largest shareholders of Conseco, Inc. (“Conseco” or the “Company”), owning approximately 9.8% of the outstanding shares of common stock (the “Shares”). We continue to believe that the Shares are undervalued at the current price levels and are interested in purchasing additional Shares. We, with the support of Conseco, would like to acquire the maximum number of Shares allowable without limiting Conseco’s ability to fully realize the benefits of its net operating loss carryforwards (“NOL”). We believe that the NOL is an extremely valuable asset to Conseco and do not wish to cause an annual limitation on the utilization of the NOL. We believe, based on Conseco’s public filings, that we can increase our percentage ownership up to 22% of the outstanding Shares (the “NOL Threshold”). We seek the Board’s support for us to acquire the Shares using a “modified Dutch auction” structure with a pricing range of $12.50 to $14.00 per Share. By conducting a tender offer, we would provide liquidity to any shareholders who desire to sell their positions in a manner that treats all shareholders equally and fairly. We may also acquire additional Shares in the open market following the tender offer to the extent there is additional availability without compromising the NOL.

As you know, we are not permitted to acquire 10% or more of the outstanding Shares without first complying with applicable insurance holding company filing requirements. We are asking for Conseco’s support of our endeavor to increase our ownership up to the NOL Threshold, subject to complying with all applicable law and regulatory filings. Specifically, we would like Conseco to advise the insurance regulators that it will not object to our increased ownership when contacted by the regulators.

Based on our discussion with James Prieur last Thursday, we believe the Board has been slow to implement the strategic review process. We believe the Board must make the review process a priority and that the Board needs to find a way to remove the long term care block exposure. We also believe the return on equity of Conseco Insurance Group is inadequate and needs to be improved as quickly as possible. We believe these issues will continue to erode shareholder value until they are resolved by the Company and we would be pleased to work with you and assist the Company in successfully resolving these issues.

We look forward to discussing these matters with you in further detail.

Sincerely,

/s/ Jack L. Howard

Jack L. Howard