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Liquidation looms as Lifemark funding deadline hits
by Iain Martin on Jun 07, 2010 at 10:52
Keydata bonds invested in Lifemark are facing a bleak future if the life settlement company cannot secure a funding deal today.
Lifemark has until 8 June to find capital or it will be forced into liquidation by the Luxembourg regulator.
It needs the cash to pay premiums on the US life policy assets it holds - policies will begin to lapse on 8 June.
Keydata administrator PricewaterhouseCooper and Lifemark’s provisional administrator KPMG are still in talks with US hedge fund CarVal Investors and other parties about a restructuring plan.Lifemark could sell policies or take out a bridging loan to give it more time to strike a deal but both options would eat into investor assets - it holds £350 million invested by 25,000 Keydata customers.
A liquidity shortfall was warned of in Lifemark's 2008 accounts but the problem has deepened because fewer policyholders have died than it predicted.
‘If there is a lapse of policies there is no other chance for Lifemark,’ said Eric Collard, partner with KPMG. ‘We have no option other than paying the premium or Lifemark goes into liquidation.’
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2 comments so far. Why not have your say?
Harry Callahan
Jun 07, 2010 at 17:18
Surely this could represent a sound financial opportunity for cash-rich investors. If the policies can continue being funded then eventually the investors will see the returns coming in. 84% of policyholders were in the 75-85 age group in May 2008. I don't know how much the total monthly premium is but with an average policy death claim value of $3.2 million and 307 policies in the portfolio (Feb 2008) surely this is a case for showing a little patience, a feature which is sadly lacking these days.
report thissimon schuster
Jun 09, 2010 at 12:29
Has anyone yet questioned the conflict of interest in PWC who are the administrators of Keydata, as well as the auditors of lifemark and the fraudlent SLS????
From what my sources tell me the restructuring plan PWC are trying to force on Lifemark feeds PWC as administrators 10 million +, which they need given they have already spent over 11 million GBP on administration in less than 12 months.
Given that a more favourable proposal to Lifemark bond holders has already been advanced several months ago which would have seen their capital preserved - it would seem that PWC need to be the ones being scrutinised.
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