A proposed liquidation plan could see creditors of troubled insurtech Vesttoo Ltd. collect an aggregate of up to $2.8 billion, according to court documents.
The proposal is included with several documents filed collectively under a plan from the Official Committee of Unsecured Creditors, a group representing Vesttoo creditors, in court documents filed in U.S. Bankruptcy Court for the District of Delaware.
The creditors committee filed an amended combined disclosure statement and Chapter 11 liquidation plan for Vesttoo and Its debtor affiliates.
Under the plan, general unsecured claims are estimated at between $1.6 billion and $2.5 billion. Other priority claims are between $200 million and $300 million.
Creditor proposals include a wind-down agreement and a liquidating trust agreement involving a wind-down officer and liquidating trustee. The court documents include terms of the plan of liquidation.
Court documents set Jan. 24 as a deadline for creditors to vote on the plan. A combined hearing on approval of a disclosure statement and confirmation of the plan is set for Feb. 6.
An effort to reach Vesttoo was not immediately successful.
Fronting carrier Clear Blue Insurance Co. recently sued Aon plc in New York state court for alleged damages connected with letters of credit issued by Vesttoo involving Aon and its White Rock entity.
In a complaint filed in Supreme Court for the State of New York, Clear Blue and related entities allege that Aon and its Bermuda-based segregated cell entity White Rock are liable for damages in the Vesttoo case.
Clear Blue seeks to recover damages from Aon for “hosting a rogue operation on its Bermuda-based platform in clear violation of law, regulation, contract and standard market practice,” Clear Blue said in its complaint. “Clear Blue entered into a series of reinsurance transactions with and/or involving Aon, its wholly owned subsidiaries Aon Insurance Managers, White Rock and White Rock’s various segregated accounts, causing material financial, regulatory and reputational damage to Clear Blue.”
“This complaint is meritless,” an Aon spokesperson said in an email to BestWire at the time. “Vesttoo has publicly admitted that its executives conspired with third parties in a highly sophisticated and elaborate fraud. As one of the victims of that fraud, Aon is focused on continuing our work to develop a path forward for all affected parties.”
Unsecured Vesttoo creditors earlier filed a motion in Delaware bankruptcy court to compel Aon plc and its White Rock Insurance Ltd. affiliate to produce documents related to the case that would be relevant to third parties.
The Official Committee of Unsecured Creditors, a group of Vesttoo creditors representing Vesttoo’s numerous creditors, petitioned the U.S. Bankruptcy Court for the District of Delaware for discovery seeking documents from Aon and White Rock related to the proceedings.
Underwriting entities of Clear Blue Insurance Group’s parent Pine Brook Capital Partners II (Cayman) are rated A- (Excellent) by AM Best.