Demutualization

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Related to Demutualized: Demutualisation

Demutualization

Refers to the process that has come about as the result of many not-for-profit exchanges (mutual companies owned by groups of members) converting to for-profit and then shareholder companies in order to go public.

Demutualization

The process by which a mutual company becomes a publicly-traded company. A mutual company is a company owned by its members or users for the benefit of those members or users. In demutualization, the members give up their rights and receive shares in the company in return, which the (now former) members may then sell. Demutualization happens most often when a stock exchange owned by its members goes public.

As an aside, a mutual company should not be confused with a mutual fund.
References in periodicals archive ?
Second, do demutualized insurers improve their efficiency after demutualization?
The major difference is that once the mutual is demutualized, the owner of all the stock will be the acquiring company rather than the open market.
Conning found that recently demutualized life insurers have infrequently accessed the capital markets and have participated minimally in M&A.
Demutualization has been discussed, debated, denounced and defended constantly since John Hancock Financial Services, and then MetLife, demutualized last year, followed by a host of others.
Fitch Ratings has recently issued a Special Report titled 'Exiting the Closed Block' which discusses rating considerations that Fitch reviews when analyzing demutualized life insurers that are looking to 'cash out' on the present value of their closed blocks.
Adapting to the pressures of a capital-markets environment is critical for demutualized life insurers.
ISE has demutualized, converting from a New York limited liability company, in which equity interests as well as trading rights were represented by single ownership interests, to a Delaware corporation, in which equity interests and trading rights are now represented by different securities.
Eight North American life insurers that have demutualized since November 1998 have added about $45 billion in market capitalization.
which demutualized last year, afforded stock only to owners of participating policies that share in the overall investment performance of the company.
Demutualized companies in recent years have worked especially hard to redeploy capital and cut expenses.
which demutualized in April, took the middle ground.