Metropolitan Life Hires Goldman Sachs to Explore Alternative Ownership Structures

Business Wire, August 10, 1998

OLDWICK, N.J.--(BUSINESS WIRE)--Aug. 10, 1998--Metropolitan Life Insurance Co. has retained Goldman Sachs to "sort through its options" pertaining to the future structure of the company, according to an article in today's Life/Health edition of BestWeek.

Goldman Sachs will be working with senior management and co-advisors CS First Boston in helping the insurer decide whether to demutualize and go public or possibly form a mutual holding company, said MetLife spokesman Kevin Foley.

Under a mutual holding company structure, policyholders own 51% of the company and shareholders publicly own 49%.

"It is not a signal that a plan is imminent at all," Mr. Foley said. "Each option has complex financial implications, and we're at that stage now. We are months away from a decision and won't have anything to say for quite some time."

Although mutual holding company legislation had been pending in New York, the proposal died after an Assembly committee report on the matter criticized thecontroversial methodof restructuring. The report cited problems with conflict of interest, management accountability and policyholder rights.

Still, Mr. Foley said MetLife hadn't ruled the option out. "As far as we're concerned, every option is still on the table until it's taken off. I'm sure in the next few meetings, we will look at whether that option is politically viable," he said.

Robert H. Benmosche, chairman, president and chief executive officer of Met Life, told BestWeek in April that he wanted to focus on transforming MetLife from a mutual insurance company to a public company.

Mr. Benmosche said he supported a two-step conversion in which the company would initially restructure to a mutual holding company with downstream insurance subsidiaries, and then--probably within 10 years--demutualize and become a fully public corporation.

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    CONTACT: Jeffrey Dunsavage
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              dunsavj@ambest.com