Corebridge, Equitable agree to $22bn all-stock merger

Corebridge Financial and Equitable Holdings have agreed to merge in an all-stock transaction that values the combined entity at around $22bn.

The merged company will have $1.5tn in assets under management and administration and serve more than 12 million clients.

Its business areas will include individual and group retirement, asset management, wealth management, life insurance and institutional markets.

The new company will integrate Corebridge’s and Equitable’s distribution networks, broaden its business mix and expand opportunities for product cross-selling.

It will also build on Equitable’s existing relationship with AllianceBernstein, shifting more than $100bn of Corebridge’s assets to AllianceBernstein over time.

The combined company expects operating earnings of more than $5bn and cash generation exceeding $4bn.

Earnings per share and cash generation are forecast to rise by more than 10% by 2028.

Adjusted return on equity is projected to surpass 15% by 2027.

In terms of structure, each Corebridge share will be swapped for one share in the newly formed parent company, while each Equitable share will be exchanged for 1.55516 shares.

After the deal closes, Corebridge shareholders will hold approximately 51% of the new company and Equitable shareholders around 49%.

Marc Costantini, Corebridge’s current president and CEO, will become president and CEO of the merged company.

Robin Raju, presently chief financial officer (CFO) at Equitable, will take on the role at the new entity. The board will include seven directors chosen by each company.

Costantini said: “With a world-class, multi-channel distribution network and an expanded offering of innovative products, we will create a balanced and resilient business well positioned to serve customers. Together, we will continue to support financial professionals and institutions in helping individuals plan, save for and achieve secure financial futures.”

Completion of the transaction is anticipated by the end of 2026, pending regulatory clearances and shareholder approval from both companies.

The combined organisation will operate under the Equitable name and the ticker symbol ‘EQH’ on the New York Stock Exchange (NYSE) and will be headquartered in Houston, Texas.

Equitable president and CEO Mark Pearson commented: “This is a transformational transaction that brings together three outstanding franchises – Corebridge, Equitable and AllianceBernstein – to create a diversified financial services company uniquely positioned to serve customers and deliver long-term value for shareholders.

“By combining complementary capabilities and scale, we will enhance what we can deliver for clients – more choice, broader access to investment and retirement solutions, and the strength of an industry leader with a stronger balance sheet standing behind our promises.”