Prudential Plc Secures Two-fold Agreement With Athene
British insurance giant Prudential Plc, which in 2019 let go of its UK and European savings and investments arm and now describes the group’s portfolio as “Asia-led,” has moved to own less of its operations in the US.
An agreement has been reached with Athene Holding Ltd that will see its subsidiary Athene Life Re invest US$500 million in Prudential’s US business in exchange for an 11.1% economic interest with a corresponding voting interest of 9.9%.
According to the London-headquartered enterprise, the investment takes the form of a cash subscription for the issuance of new common equity in Brooke (Holdco 1) Inc, which is the holding company containing Prudential’s Michigan-based Jackson National Life Insurance Company and Illinois asset manager PPM America Inc.
Payable in cash at completion, the investment will be deployed in Jackson. Prudential, however, will continue to prepare for Jackson’s minority initial public offering alongside the active evaluation of other options to create an independent US business.
Meanwhile, in addition to the equity investment, Athene Life Re is also reinsuring the US$27.6 billion in-force portfolio of Jackson’s US fixed and fixed indexed annuity liabilities. The reinsurance transaction came into effect on June 01.
Prudential noted that the combined effects of the investment and reinsurance are expected to improve the risk-based capital cover ratio of Jackson by approximately 80 percentage points.
“We are delighted to be forging a new relationship with the team at Athene, given their deep expertise in the US annuity sector and long-term commitment to its development,” commented Prudential group chief executive Mike Wells. “This agreement is a key step forward in meeting our strategic objectives for Jackson.”
The investment is expected to complete in July.
People Power: Building The Future Of Insurance One Career At A Time
The insurance industry is at a pivotal point. As emerging technologies reshape underwriting, claims processing, and cust... Read more
Private Equity's Great Divide: Is The Future Insurance-Funded Or Fee-Driven?
A fundamental shift is taking place at the top of the private equity industry. While firms like Blackstone remain commit... Read more
Japan's Next Battleground: The Insurance Sector Under Activist Pressure
Farallon’s push at T&D Holdings marks a shift in focus for activist capital targeting Japan’s untapped insurance... Read more
Cover And Conflict: Tensions Rise Between Insurers And Litigation Funders
Burford’s clash with Chubb signals a deeper rift in the legal-financial ecosystem A high-profile dispute between li... Read more
Underwater And Uninsured: How Climate Risk Is Reshaping The US Mortgage Market
As climate change intensifies, its effects are no longer confined to coastlines or news reports on extreme weather. In t... Read more
When The Raters Get Rated: What The Fitch–Kroll Feud Says About Oversight And Accountability
In a rare and unusually public confrontation between two of America’s credit rating agencies, a recent feud between Fi... Read more