| Copyright: | A.M. Best Company, Inc. |
| Source: | BestWire Services |
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U.S. life insurer Symetra Financial Corp., which priced the initial public offering of its common stock at the low end of its initial range, has so far raised $364.8 million.
The Bellevue, Wash.-based Symetra on Jan. 21 said it priced the IPO at $12 a share. The offering consisted of 20,699,510 primary shares the company would sell and 9,700,490 secondary shares to be sold by existing stockholders. Symetra originally planned to sell 27 million shares between $12 and $14 each.
Affiliates of White Mountains Insurance Group Ltd. and Warren Buffett's Berkshire Hathaway Inc., which led the investor group that formed Symetra in 2004, aren't selling any shares in the offering.
The company's stock started trading on the New York Stock Exchange Jan. 22 under the ticker symbol "SYA." Around mid-morning that day, its stock was trading at around $13 a share.
Steven Schwartz, an equity analyst with Raymond James, said the last IPO in the life industry was Genworth Financial (NYSE: GNW) in May 2004, when it was spun off from General Electric. "The environment for IPOs and follow-on offerings has been relatively good, in general," he said.
A Symetra spokeswoman said she couldn't comment beyond the company's Jan. 21 statement because the company is in a quiet period for another 25 days.
"Today is an exciting and historic day for our company," said Randy Talbot, president and chief executive officer of Symetra Financial, in a statement. "Everyone at Symetra has worked hard to reach this important milestone."
"There have been a number of such (IPO) offerings for real estate and energy-related companies, although equity offerings for insurers has slowed down a bit since a number of insurers took advantage of rising equity markets in the second and third quarters of last year to rebuild capital levels," Schwartz said.
Earlier this month, Symetra said it was seeking to raise nearly $435 million in the IPO. In a filing with the U.S. Securities and Exchange Commission, the company said the proposed maximum aggregate offering price is $434.7 million, and it expected the public offering price to be between $12 and $14 a share (BestWire, Jan. 8, 2010).
Symetra said in June 2007 it would raise more -- up to $750 million -- in the IPO (BestWire, June 29, 2007). But in November of that year, it postponed the deal, saying current market conditions weren't favorable to shareholders (BestWire, Nov. 12, 2007).
But last October, the life insurer's plan to become a publicly traded company was back on (BestWire, Oct. 6, 2009).
Its offering is expected to close around Jan. 27.
In January 2007, Symetra Life Insurance Co., a unit of Symetra, marked 50 years in business. Originally incorporated in 1957 as General Life Company of America, the name was changed in 1959 to Lifeco Insurance Company of America, according to BestLink, which provides online access to A.M. Best's Global Insurance & Banking Database.
The present name -- Symetra Life -- was adopted in 2004 after the company was acquired from property/casualty insurer Safeco Corp. by the investor group (BestWire, Nov. 12, 2007).
BofA Merrill Lynch, J.P. Morgan, Goldman, Sachs & Co., and Barclays Capital are joint book-running managers for the offering. The underwriters have a 30-day option to buy up to an additional 4,560,000 shares of Symetra's stock at the public offering price, less the underwriting discount.
Symetra Life Insurance currently has a Best's Financial Strength Rating of A (Excellent).
(By Fran Matso Lysiak, senior associate editor, BestWeek: fran.lysiak@ambest.com)
