[Hancock]'s D'Alessandro said the goal is to cut $250 million in expenses, about 10 percent of the combined companies' expenses, over three years. He said he thought most of the job cuts could come through attrition, but wouldn't put a number on the reductions. As part of the deal, however, Manulife will extend by four years the commitment Hancock made when it went public to maintain the majority of its work force in Massachusetts. Hancock has about 3,800 employees in the state; Manulife has more than 700 people here.
Hancock, the sixth largest publicly traded insurer in the country, has been looking hard to make a deal. In May, the Globe reported that Hancock and FleetBoston had explored combining the two companies to ensure a big Boston-based financial services player. A month later, the Globe reported that Hancock had held far more substantial discussions over eight months with Prudential. Along the way, Hancock also talked with MetLife, ING, Allianz and Citigroup, among others.
Hancock had to take huge writedowns in its investments in the energy and airline industries. Inside Hancock, the biggest fear was that the ratings agencies would lower the company's credit rating making it next to impossible to compete in the sale of such instruments as guaranteed investment contracts, or GICs, one of Hancock's most profitable businesses. One of the benefits of the combination, executives said, is that Hancock's problem credits can now be spread over a larger base, putting them in line with the industry average.