Anthem IPO Warms Cold Market

The company grew through internal growth and a series of mergers and acquisitions. It now provides major medical coverage for 7.8 million people, and it holds the Blue Cross and Blue Shield licenses in Indiana, Kentucky, Ohio, Connecticut, New Hampshire, Colorado, Nevada and Maine.

The company notified the U.S. Securities and Exchange Commission in August that it intended to convert to a stock company charter, sell some stock to the public, then use a combination of 55 million additional shares of stock and the cash raised through the stock sale to compensate eligible policyholders for their loss of policy-based ownership rights.

Anthem estimates that it has about 1 million "statutory members" who are eligible to receive conversion compensation.

Anthem received 362,000 policyholder votes on the demutualization, and 95% of the votes supported the demutualization plan, Anthem says.

The Indiana demutualization law required that two-thirds of the policyholders approve the conversion.

The Anthem IPO is the second major insurance company IPO that has come out the door in the past two weeks. Last week, Principal Financial Group Inc., Des Moines, Iowa, a mutual life insurer, converted to a stock company charter and organized an IPO that raised $1.8 billion. Shares of Principal Financial stock were selling for $21.15 at 11 a.m. Tuesday, up 14% over the original offering price.