Symetra, a Buffett Holding, Plans IPO... Again (SYA, BRK-A, WTM, BEN, OZM)

After the close on Monday came a little-known IPO filing from a life insurance operation called Symetra Financial Corp.  It turns out that the Bellevue, Washington-based insurer has no terms for the sale but listed a sale of up to $575 million in the initial public offering filing.  This is not the first attempt to come public, but it turns out that Warren Buffett’s Berkshire Hathaway Inc. (NYSE: BRK-A) and White Mountains Insurance Group, Ltd. (NYSE: WTM) effectively control the company.

This one filed for an IPO of up to $750 million back in 2007, but the insurer pulled the plug on the IPO in 2008.  You can guess the reason listed… ‘unfavorable market conditions.’

Symetra plans to trade under the stock ticker “SYA” on the New York Stock Exchange. It has an impressive lineup of joint book running managers: BofA Merrill Lynch, JPMorgan, Goldman Sachs and Barclays Capital.

We noted that Berkshire Hathaway is a shareholder, and that stake is listed as 26.3%.  But other shareholders include White Mountains Insurance Group, Ltd. (NYSE: WTM) also listed with a 26.3% stake.  Franklin Mutual Advisers, LLC, a unit of Franklin Resources, Inc. (NYSE: BEN) is listed as a 11.7% stakeholder.  Even Och-Ziff Capital Management Group LLC (NYSE: OZM) is listed as a 6.6% stakeholder via its OZ Master Fund, Ltd.  Other stakeholders include Vestar Capital Partners, Highfields Capital Management, and Caxton Associates.

Based on how Symetra’s stakeholders are listed and per the filing, this is effectively controlled by Symetra is controlled by Berkshire’s General Re and White Mountains.  This time the company and holders will sell shares, although again terms are not disclosed.

Symetra’s revenues fell by almost 9% in 2008 from 2007 to $1.45 billion, with about 60% coming from group and individual insurance lines.  Most of the drop was attributed to investment losses.

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JON C. OGG
OCTOBER 6, 2009