DES MOINES - The Principal Financial Group announced Monday that it plans to convert its Principal Mutual Holding Co. subsidiary into a stock company.
Management at Principal Financial, which serves more than 11 million business and consumer customers and has more than $117 billion of assets under management, expects to complete the "demutualization" plan in the first half of 2001. It will be subject to approval by the board of directors, eligible policyholders, and Iowa's insurance commissioner.
J. Barry Griswell, president and chief executive officer of Principal Financial, said in a press release that the company's "study of structural alternatives made it clear that demutualization provides the greatest flexibility for us to access capital efficiently and execute our growth strategy of becoming a global leader in asset accumulation and asset management."
The Principal converted to a mutual insurance holding company structure in 1998. Principal Mutual "has been a tremendous success and enabled us to do many things, one of which was to acquire BT Financial Group," David J. Drury, chairman of Principal Financial, said in the release. That was The Principal's biggest acquisition ever.
However, Mr. Drury said, "The marketplace has changed significantly," and dictates the demutualization move.
Principal Financial's offerings include retirement and investment services, life and health insurance, and mortgage banking.