MetLife Inc. plans to trade its 52% stake in Reinsurance Group of America Inc. for MetLife stock, the companies say.
RGA, St. Louis, will start the transaction by “recapitalizing” its common stock into 2 classes, the companies say.
Holders of the Class A common stock could elect up to 20% of RGA’s directors, and holders of the Class B common stock could elect up to 80% of the directors.
MetLife, New York, would exchange its existing RGA stock for RGA Class B common stock, then trade the RGA Class B common stock for some of MetLife stockholders’ shares of MetLife common stock.
The deal should make RGA’s common stock more liquid, and it will “provide RGA management with greater flexibility in dealing with the opportunities and challenges specific to its businesses,” the companies say.
RGA has a market capitalization, or total stock value, of about $3.2 billion, and that would appear to give the proposed stock swap a value of about $1.6 billion.
The companies hope to complete the deal by Sept. 30.
To complete the deal, the companies need the approval of the holders of a majority of RGA’s common stock owned by entities other than MetLife.