Great-West Lifeco buys Prudential’s retirement business in $4.45-billion deal

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Prudential’s retirement business covers about 4 million participants, 4,300 workplace savings plans and has US$314 billion in assets under administration

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Prudential Financial Inc. has agreed to sell its full-service retirement business to Great-West Lifeco Inc.’s U.S. unit Empower Retirement in a deal valued at $4.45 billion (US$3.51 billion), the companies said on Wednesday.

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The deal will expand Empower’s customer base to more than 16.6 million participants, Lifeco said in a statement. It would finance the purchase with a combination of debt and existing resources.

Prudential’s full-service retirement business covers about 4 million participants, 4,300 workplace savings plans and has US$314 billion in assets under administration.

Great-West Lifeco sells life and health insurance besides having interests in reinsurance, asset management and retirement savings. It has operations in Canada, the United States and Europe.

The deal, which is expected to close in the first quarter of 2022, will include a share repurchase and a reinsurance transaction.

Shares of Prudential were up about 2 per cent in premarket trading.

© Thomson Reuters 2021