Newark, New Jersey-based insurance firm Prudential Financial has concluded a $3.5bn deal to divest its full-service retirement business to Empower.
The deal, announced last year in July, includes Prudential’s defined contribution, defined benefit, non-qualified as well as rollover IRA operations.
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It also covers the firm’s stable value and separate account investment products and platforms.
Prudential executive vice president and head of U.S. Businesses Andy Sullivan said: “The close of this transaction marks another significant milestone in Prudential’s strategy to become a higher growth, less market sensitive, more nimble business.
“Empower, like Prudential, is driven by purpose and in them we found a partner with the scale and expertise to ensure long-term success for the retirement business.”
The deal bolsters the reach of Empower to more than 17.1 million retirement plan participants with $1.4trn in assets under administration.
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By GlobalDataIt also includes over 1,800 staff who will serve financial professionals, plan sponsors and participants by offering retirement record keeping and administration services.
Empower president and CEO Edmund F. Murphy III said: “This transaction will create an even stronger service organisation at Empower, expands our product offerings and the deepens the expertise of our talent pool.”
Separately, Prudential also completed the sale of $31bn of traditional variable annuity block to Fortitude Re.
The deal was announced in September 2021.
Under the agreement, Fortitude Re will buy Prudential Annuities Life Assurance Corporation (PALAC) and rebrand it to Fortitude Life Insurance & Annuity Company.
The deal includes nearly $31bn of in-force variable annuity account values. These cover mainly non-New York, traditional variable annuities with guaranteed living benefits issued by PALAC before 2011.
