Recordkeeper M&As surge: Empower Retirement to acquire Prudential's retirement business
4 million participants in 4,300 workplace savings plans will have a new recordkeeper.
Empower Retirement has reached an agreement to acquire Prudential Financial’s full-service retirement business. The acquisition, it says, will add significant expertise, a broader set of capabilities and an expanded product portfolio to Empower’s existing business and drive additional scale to the benefit of retirement investors and employers who sponsor workplace savings plans.
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“Empower and Prudential share a commitment to serving the financial needs of working Americans, their advisors and employers,” said Ed Murphy, president and CEO of Empower. “This transaction will create an even stronger service organization at Empower, fueled by technology and the expertise of our deep talent pool. We will continue to leverage our scale and resources to challenge the status quo and be uniquely positioned to serve the retirement and wealth management needs of millions of retirement savers in every phase of their financial journey.”
Prudential’s full-service retirement recordkeeping business comprises more than 4,300 workplace savings plans, through which approximately four million plan participants have saved $314 billion in assets. It also includes more than 1,800 employees who provide a comprehensive suite of retirement recordkeeping and administration services to financial professionals, plan sponsors and participants.
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“Today’s announcement is a significant milestone in Prudential’s transformation and the execution of our strategy to become a higher-growth, less market-sensitive, more-nimble business,” said Charles Lowery, chairman and CEO of Prudential.
“In Empower, we have found a partner that, like Prudential, is passionate about expanding financial opportunity for more people and that has the scale and expertise to ensure the long-term success of the full-service retirement business.”
Empower expects the acquisition to benefit retirement plan participants by combining two client-focused businesses with deep retirement expertise on a single state-of-the-art technology platform.
The acquisition will allow Empower to expand services to the broadening spectrum of workplace savings plans it now serves, which includes mega-, large-, mid-size and small corporate 401(k) plans; government plans ranging in scale from state-level plans to municipal agencies; not-for-profit 403(b) plans; and collectively bargained Taft-Hartley plans.
Prudential will continue to participate in the institutional and individual retirement market through its institutional investment products business, as well as through income and investments solutions provided by its individual annuities business and PGIM.
The transaction is expected to close in the first quarter of 2022. pending customary regulatory approvals.
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