MetLife has unveiled plans to separate a major portion of its life insurance and retail business from the core company in the US.
Currently, the company is assessing structural alternatives for separation, including a public offering of shares in an independent, publicly traded company, a spin-off, or a sale.
The new company is expected to comprise of entities, including MetLife Insurance Company USA, General American Life Insurance Company and Metropolitan Tower Life Insurance Company.
It will also include various subsidiaries, which have reinsured risks underwritten by MetLife Insurance Company USA. MetLife executive vice-president Eric Steigerwalt will lead the new company.
With around $240bn worth assets, the new firm will constitute around 20% of the operating earnings of MetLife and 50% of the operating earnings of MetLife’s retail segment.
MetLife holds remaining units, comprising group, voluntary and worksite benefits (GVWB), corporate benefit funding (CBF), Asia, Latin America, and Europe, the Middle East and Africa (EMEA) businesses.
The company also holds some of the US retail segment, including life insurance closed block, property-casualty, and the life and annuity business sold through Metropolitan Life Insurance Company (MLIC).
MetLife chairman, president and CEO Steven Kandarian said: "At MetLife our goal is to create long-term value for our shareholders and deliver exceptional customer experiences.
"As a result of our accelerating value strategic initiative, MetLife has been evaluating opportunities to increase sustainable cash generation and is directing capital to businesses where we can achieve a clear competitive advantage and deliver a differentiated value proposition for customers.
Through its subsidiaries and affiliates, MetLife provides life insurance, annuities, employee benefits and asset management services for around 100 million customers in around 50 countries.
Image: MetLife plans to separate a substantial portion of its US life insurance unit. Photo: courtesy of fantasista / FreeDigitalPhotos.net.