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. Last Updated: 07/27/2016

MetLife Unveils Plan to Go Public




NEW YORK -- Metropolitan Life Insurance Co. said over the weekend that it expects to go public in the next year or two, making it the latest life insurance giant to seek to end its long history as a mutual insurer.


MetLife, the second largest life insurer, said Sunday after an extensive evaluation of its strategic alternatives that its board authorized it to develop a plan to revert to a stock company.


MetLife, which has been based in New York since 1868, converted to a mutual company from a stock company in 1915.


MetLife Chairman Robert Benmosche said the company also plans to raise capital through an initial public offering at the time of its conversion, known as a demutualization.


The company, which has a book value of $14 billion, said it expects its initial shareholder base would exceed 12 million, several times larger than today's most widely held U.S. companies.


As a result of the flexibility offered by the stock company structure and access to capital markets, MetLife said it believes it will be in a position to strengthen its market leadership and strategic position and aggressively pursue opportunities for growth.


Newark, New Jersey-based Prudential Insurance Co. of America, the nation's largest life insurer, and Boston-based John Hancock have already announced plans to demutualize.


MONY Group Inc. earlier this month completed its demutualization and now trades on the New York Stock Exchange.


The demutualization trend has gathered steam in the last year or so as mutual insurers seek to become more competitive in the industry's merger and acquisitions game.


Publicly traded companies routinely use stock as currency in acquisition transactions, putting mutual insurers, which are owned by their policyholders, at a disadvantage in the bidding for most deals.


"With access to the capital markets, we will be better able to enhance our customers' service capabilities, develop new products and services, and pursue strategic opportunities, including acquisitions," Benmosche said in a statement.


MetLife's announcement marks a shift in its strategy to access the equity markets. The company had been one of the most vocal advocates of state legislation that would have allowed it to convert to a mutual holding company structure.


The details of these proposals and other issues will be developed in the months ahead and will be subject to the approval of the the U.S. Securities Exchange Commission and Internal Revenue Service.