Printer Friendly


 NEW YORK, Aug. 2 /PRNewswire/ -- One of the largest and most successful odd-lot sales and purchase programs ever has been completed by The Equitable Companies Incorporated (NYSE: EQ). The program, involving more than five million shares, was conducted for Equitable's nearly one million policyholders who became owners of relatively small amounts of common shares after the company converted to public ownership last year.
 As a result of the extremely high participation rate in the program, Equitable achieved its goal of reducing the number of participating policyholder/shareholder odd-lot accounts by 40 percent. This is anticipated to result in a total annual cost savings of more than $4 million for Equitable due to reduced administrative expense associated with maintaining these small accounts.
 "This innovative program provided an enormous benefit to our policyholders who are now shareholders and to The Equitable," said William T. McCaffrey, executive vice president and chief administrative officer of The Equitable. "Our odd-lot shareholders who chose to sell their stock did so at a market price which was more than double the amount at which they received the shares a year ago -- all at no transaction cost to them. And those who elected to round up their shares were able to purchase additional Equitable stock with no charge for commission."
 "The Equitable will achieve a substantial expense reduction," he continued. "Importantly, the entire program was conducted with no disruption to the trading price of Equitable common stock on the New York Stock Exchange."
 The odd-lot sales and purchase program provided policyholders- turned-shareholders who owned fewer than 100 shares with the opportunity to round out their common stock holdings with no commission charge.
 The program was administered by First Chicago Trust Company of New York, with the Pershing Division of Equitable's Donaldson, Lufkin & Jenrette subsidiary conducting the transactions.
 "These exciting results make this by far the most successful odd-lot sales and purchase program that First Chicago -- a leader in this field -- has ever conducted for a client," said Joseph D. Schmittler, vice president, First Chicago.
 The policyholders initially received their shares in July 1992, when Equitable completed its historic conversion from a mutual to a stockholder-owned company. At that time, a total of 22.6 million shares were distributed in varying amounts to more than 1.4 million policyholders in the newly formed Equitable Companies Incorporated in exchange for their membership in the former mutual company.
 The stock was issued to the policyholders at a rate of $9 per share. On Friday, July 23, the last day of the three-month-long odd-lot sales and purchase program, Equitable's common stock closed at $20 per share. The shares traded at an average price of $20.08 per share during the duration of the program, which began on April 9, 1993, with the high reaching $22.50 and the low $18.75.
 In total, nearly one million shareholders were eligible to participate in the odd-lot sales and purchase program, with 350,095 actually taking part. Of that amount, 305,078 shareholders chose to sell a total of 2.52 million shares and 37,146 decided to buy 2.67 million shares, making the program a net buyer of shares. Most of the buy and sell transactions were matched as part of the program, with actual market trades being a smaller amount.
 According to McCaffrey, "We were pleased to note that purchases actually exceeded sales during the program, while still allowing Equitable to decrease significantly the number of small shareholders it had to service."
 Under the program, holders of 20 or fewer shares could sell their stock at market prices free of any brokerage commissions or round up to 100 shares, while holders of 21 to 99 shares were eligible to purchase the number of shares necessary to round up to 100.
 Option Program Activated
 A stock option program -- previously approved as part of Equitable's demutualization -- was initiated by The Equitable on July 15, 1993. A total of 373 Equitable officers and agency managers are eligible to receive an initial grant option of 6.1 million shares. The demutualization plan restricted granting options for a period of one year following the company's initial public offering. The option price was set at the July 15 closing market price of $20 per share.
 The Equitable Companies Incorporated is one of the world's largest asset managers with more than $160 billion in funds under management, through products distributed by its primary businesses: The Equitable Life Assurance Society of the U.S.; Equitable Variable Life Insurance Company; Alliance Capital Management L.P.; Donaldson, Lufkin & Jenrette Inc.; and Equitable Real Estate Investment Management Inc. The Equitable and AXA, its largest shareholder and global partner, are among the world's leading providers of insurance and asset management products and services.
 -0- 8/2/93
 /CONTACT: Nancy Amiel, 212-554-4293, or Jim Lacey, 212-554-1441, or (investors) Greg Wilcox, 212-554-2595, both of The Equitable Companies/

CO: The Equitable Companies Incorporated ST: New York IN: INS SU: OFR

TS -- NY081 -- 8419 08/02/93 14:00 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Aug 2, 1993

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters