8-KFinancial EventsExhibits & Filings

METLIFE INC 8-K Report, Financial Obligation (Jun 22, 2017)

Filed June 22, 2017For Securities:METMET-PEMET-PFMET-PA

Summary

MetLife Inc. (MET) filed an 8-K on June 22, 2017, detailing a significant financial obligation related to its subsidiary, Brighthouse Financial, Inc. (Brighthouse). Brighthouse issued $3 billion in aggregate principal amount of senior notes, consisting of $1.5 billion in 3.700% Senior Notes due 2027 and $1.5 billion in 4.700% Senior Notes due 2047. These notes are senior unsecured obligations of Brighthouse. MetLife has provided a full and unconditional guarantee for these notes. This guarantee is intended to be released upon the completion of a "Brighthouse Stock Distribution Event," which involves MetLife contributing its interests in Brighthouse to the subsidiary and transferring at least 80.1% of Brighthouse's common stock to external parties, likely as part of a spin-off or public offering. If this distribution event does not occur by December 31, 2017, Brighthouse is obligated to redeem the notes at a premium of 101% of their principal amount.

Key Highlights

  • 1Brighthouse Financial, a MetLife subsidiary, issued $3 billion in senior notes (3.700% due 2027 and 4.700% due 2047).
  • 2MetLife Inc. is acting as a guarantor for these Brighthouse notes.
  • 3The guarantee is structured to be released upon the completion of a "Brighthouse Stock Distribution Event," which is part of MetLife's plan to separate Brighthouse.
  • 4A key condition for the guarantee's release involves MetLife transferring at least 80.1% of Brighthouse's common stock to external parties.
  • 5If the separation (Brighthouse Stock Distribution Event) is not completed by December 31, 2017, Brighthouse must redeem the notes at a 101% premium.
  • 6This filing signifies a crucial step in MetLife's strategic separation of Brighthouse Financial, impacting the financial structure of both entities.

Frequently Asked Questions

This 8-K filing discloses the creation of a direct financial obligation by MetLife's subsidiary, Brighthouse Financial, Inc., which issued $3 billion in senior notes. It also details MetLife's guarantee of these notes and the conditions for its release, which are tied to the planned separation of Brighthouse.

MetLife is acting as a guarantor for the $3 billion in senior notes issued by its subsidiary, Brighthouse Financial. This means MetLife has fully and unconditionally guaranteed the principal, interest, and other obligations of Brighthouse under the notes.

MetLife's guarantee will be automatically and unconditionally released upon the completion of a "Brighthouse Stock Distribution Event." This event involves MetLife contributing its interests in Brighthouse to the subsidiary and transferring at least 80.1% of Brighthouse's common stock to third parties, as part of a separation strategy (e.g., spin-off, public offering, or sale).

If the "Brighthouse Stock Distribution Event" has not occurred by December 31, 2017, Brighthouse is obligated to redeem all of the issued notes on the tenth business day following that date. The redemption price will be 101% of the outstanding principal amount, plus accrued interest.