MetLife Inc. posted the biggest decline in the 21-company Standard & Poor’s 500 Insurance Index after announcing the departure of William Wheeler, disappointing those who thought he would be the next chief executive officer.
Wheeler, 53, the former chief financial officer who has led the Americas unit since 2011, will retire in August, the New York-based company said Tuesday in a statement that didn’t name a successor. He said in the statement that he would “pursue other interests.” A former banker at Donaldson, Lufkin & Jenrette, Wheeler was named in February to the board of Evercore Partners Inc., a firm that advises on mergers and acquisitions.
His exit is “a very surprising development that we view as a negative for MetLife,” Ryan Krueger and Blake Mock, analysts at Keefe, Bruyette & Woods Inc., wrote in a note to clients. “We view it as a meaningful management loss for the company that creates future uncertainty regarding an eventual CEO transition.”
Steve Kandarian, who became CEO in 2011, is 63. While MetLife, the largest U.S. life insurer, has a mandatory retirement age of 65, that can be waived by the board of directors, according to a person familiar with the matter who asked not to be named discussing internal considerations.
Wheeler helped integrate American Life Insurance Co., the insurer that had operations in more than 50 countries when MetLife bought it for about $16 billion in 2010. Then, in the Americas post, he oversaw the acquisition of Chilean pension provider AFP Provida SA while working to cut costs in the U.S. and scaling back risks tied to retirement products like variable annuities.
Wheeler’s decision to join the board at Evercore may have signaled that he was no longer in line to succeed Kandarian, according to Sean Dargan, an analyst at Macquarie Group Ltd. Being on Evercore’s board could have presented a conflict, he said.
“If you’re on the board of directors of a firm which is thought of as an M&A boutique, you would presumably have access to insurance deal flow,” he said. “And presumably in his role as head of the Americas at MetLife he also had access to deal flow.”
MetLife is considering internal and external candidates for the Americas post, a person familiar with the company’s thinking said. The Americas is the largest of the insurer’s regions. Michel Khalaf heads Europe, the Middle East and Africa while Christopher Townsend leads Asia.