MetLifeInc. will spinoff its retail business into the newly , publicly traded BrighthouseFinancial.
A Form 10 details the separation, which is expected to beginin the first half of 2017. At least 80.1% of Brighthouse's common stock will bedistributed to MetLife shareholders in the spinoff transaction.
MetLife noted that after the separation, its cost of capitaland exposure to market risk should be reduced.
As of June 30, MetLife and its holding companies had $4.9billion in liquid assets. The company expects to incur about $1.5 billion inseparation-related items in the second half of 2016, consisting of forgonedividends and incremental debt, as well as expenses. MetLife expects to receivedividends before the separation of about $3.3 billion to $3.8 billion fromBrighthouse and a MetLife-affiliated reinsurance subsidiary, subject toinvestor interest, ratings actions and the macroeconomic environment. MetLifewill also retain some shares of Brighthouse.
Following the transaction, MetLife plans to maintain liquidassets at its remaining holding companies of $3.0 billion to $4.0 billion.
Brighthouse will encompass MetLife's U.S. life insurance andannuity books of business, with about $240 billion in assets and 2.6 millioninsurance policies and annuity contracts in force as of June 30. After the spinoff,MetLife will provide employee benefits in the U.S. and serve as a globalinsurer.
The separation is still subject to various conditions,including final approval from the MetLife board, a favorable IRS ruling and anopinion from MetLife's tax adviser.