MetLife 2010 Annual Report Download - page 118

Company’s diversification by product, distribution and geography, meaningfully accelerate MetLife’s global growth strategy, and create the
opportunity to build an international franchise leveraging the key strengths of ALICO. ALICO’s largest international market is Japan. As of
December 31, 2010, the Japan operation’s total assets represented approximately 12% of the Company’s total assets.
Fair Value and Allocation of Purchase Price
The computation of total purchase consideration and the amounts recognized for each major class of assets acquired and liabilities
assumed, based upon their respective fair values at the Acquisition Date, and the resulting goodwill, are presented below:
November 1, 2010
(In millions)
Cash................................................................ $ 6,800
MetLife, Inc.’s common stock (78,239,712 shares)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,200
MetLife,Inc.’sConvertiblePreferredStock(1),(2) ................................... 2,805
MetLife,Inc.’sEquityUnits($3.0billionaggregatestatedamount)(3)....................... 3,189
TotalcashpaidandsecuritiesissuedtoALICOHoldings ............................. $15,994
Contractualpurchasepriceadjustments(4) ....................................... 396
Totalpurchaseprice..................................................... $16,390
Effectivesettlementofpre-existingrelationships(5).................................. (186)
Contingentconsideration(6) ................................................. 88
TotalpurchaseconsiderationforALICO ........................................ $16,292
(1) Fair value is based on the opening price of MetLife, Inc.’s common stock of $40.90 on the New York Stock Exchange (“NYSE”) on
November 1, 2010.
(2) Convertible into 68,570,000 shares of MetLife, Inc.’s common stock upon a favorable vote of MetLife, Inc.’s common stockholders before
the first anniversary of the Acquisition Date. See Note 18.
(3) The Equity Units include the Debt Securities and the Purchase Contracts that will settle in MetLife, Inc.’s common stock on specified
future dates. See Note 14.
(4) Relates to the cash settlement of intercompany balances prior to the Acquisition for amounts in excess of certain agreed-upon thresholds
and certain other adjustments.
(5) Effective settlement of debt securities issued by MetLife, Inc. that are owned by ALICO and reduces the total purchase consideration.
(6) Estimated fair value of potential payments related to the adequacy of reserves for guarantees on the fair value of a fund of assets backing
certain United Kingdom (“U.K.”) unit-linked contracts.
The aggregate amount of MetLife, Inc.’s common stock to be issued to ALICO Holdings in connection with the transaction is expected to
be between 214.6 million to 231.5 million shares, consisting of 78.2 million shares issued at closing, 68.6 million shares to be issued upon
conversion of the Convertible Preferred Stock and between 67.8 million and 84.7 million shares of common stock, in total, issuable upon
settlement of the Purchase Contracts forming part of the Equity Units. See Note 14. The ownership of the shares issued to ALICO Holdings is
subject to an investor rights agreement, which grants to ALICO Holdings certain rights and sets forth certain agreements with respect to
ALICO Holdings’ ownership of, voting on and transfer of the shares, including minimum holding periods and restrictions on the number of
shares ALICO Holdings can sell at one time.
F-29MetLife, Inc.
MetLife, Inc.
Notes to the Consolidated Financial Statements — (Continued)