Author: Antony Currie
MetLife had been working on its demutualization plan for at least three years before finally coming to market in April. "We took a look at where financial services was heading," says MetLife CEO Bob Benmosche. "It is clear that people didn't have the time to shop around, so we had to be able to put ourselves in a position to offer a full range of financial products. And with Glass-Steagall in the process of being overturned it was all the more crucial. Going public gives us the right structure, and a currency to use for that purpose,"
Launching on April 4, MetLife encountered the same angst-ridden equity markets as did Krispy Kreme Doughnuts, but MetLife had an extra problem to worry about. Recent deals for other insurance companies going public had not gone well, and the most recent, which Morgan Stanley Dean Witter had lead-managed for John Hancock Financial Services in January, was actually trading below its issue price.
Added to that, MetLife was the largest insurance company to come to market. It had over 10 million policyholders who were about to become shareholders, giving MetLife the largest number of shareholders in the country.