Manulife says John Hancock spinoff is a “market rumour”

Company does say it is looking for ways to optimise its balance sheet

Manulife says John Hancock spinoff is a “market rumour”

Insurance News

By Lyle Adriano

Manulife Financial has clarified speculation that it is exploring an initial public offering of its US unit, John Hancock.

Several of Manulife’s competitors, namely MetLife and AXA SA, have shed their US operations prompting speculation that Manulife would follow suit.

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In July, the Wall Street Journal reported that Manulife was under pressure from several of its shareholders to spinoff John Hancock Financial Services after years of disappointing performance at the unit.

“It’s all market rumor and speculation as far as I’m concerned,” Manulife CFO Steve Roder told Reuters in an interview.

What Manulife did confirm, however, was that it would consider selling some businesses that are impeding its growth.

“For the last 18 months or so, we’ve highlighted to our investors that we are always considering how we can optimize our balance sheet and accelerate the growth in [return on equity],” Roder explained.

During a conference call with investors, outgoing CEO Don Guloien said that the company had “some challenging blocks of legacy business” and “regularly investigates all opportunities of improving shareholder value.”

When he was asked if he thought an IPO of John Hancock was a non-starter, he said: “No, I don’t think there are any non-starters. When you run a public company you’ve got to look at every perspective in a dispassionate way. That’s not to suggest that we would do that or that’s it’s easy to do. The ultimate determination would be is it good for building shareholder value? That would be the criteria our company would use.”

Related stories:
Manulife, Sun Life beat forecasts post strong growth in Asian markets
Manulife Hong Kong appoints Rockson Leung as chief financial officer


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