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IPOs in the East

|Includes: AIG, AXA, AZ, MetLife, Inc. (MET)

A story in the Wall Street Journal today stated that Japan's Dai-Ichi Mutual Life had announced it's intention to demutualize and float an IPO which is estimated to raise $11.8 billion on April 1.  This would make Dai-Ichi, Japan's number 2 life insurer by premium, the first of the country's big four insurers to demutualize. It would also be the biggest IPO in Japan since Visa's $19.7 bln issuance in 2008, according to the Journal and Dealogic.

So the jockeying for positioning out east heats up.  MetLife is reportedly working hard to push through its $15 billion deal for AIG arm ALICO, which is big in Japan but not China. AXA is trying to figure out which suitor -- NAB or AMP -- will purchase its Asian subsidiary AXA SA to take its Australian wealth management group and sell the 46% of the Asian insurance business that AXA doesn't own to the Paris parent company.

Waiting in the wings is the planned Hong Kong IPO of $10 billion worth of AIA, AIG's other major Asian life insurance subsidiary, which is strong in China but not Japan.  Valuation estimates for AIA have swirled in the neighborhood of $28-30 billion.  The Journal recently reported that there are now nine investment banks that will serve as bookrunners on the offering.

But will the AIA IPO fly as planned?  The last big Hong Kong IPO -- Rusal -- has not held its value very well.  There are considerable concerns that China may be a bubble.

Meanwhile, AXA and Allianz have delisted their ADRs from the New York and London exchanges to reduce reporting complexities. One suspects that more activity could await patient observers.



Disclosure: Indices only