Greenwood Village-based Empower Retirement announced Wednesday a $3.55 billion deal to buy Prudential Financial Inc.’s full-service retirement business.
Terms call for Empower to acquire Prudential’s (NYSE: PRU) retirement plan record-keeping and administration business, which includes 4,300 workplace savings plans with about 4 million participants with $314 billion in assets.
“Empower and Prudential share a commitment to serving the financial needs of working Americans, their advisors and employers. This transaction will create an even stronger service organization at Empower, fueled by technology and the expertise of our deep talent pool,” Ed Murphy, Empower president and CEO, said in a statement. “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.”
The deal includes more than 1,800 Prudential employees. Empower expects more than 95% of those employees to be offered roles in the company. That would add to the company’s worldwide workforce of about 8,900, with 2,700 based in Colorado.
Prudential officials said the sale proceeds will be used for general corporate purposes. The company expects to return $11 billion to shareholders through 2023, up from the $10.5 billion announced in May.
“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,” Prudential Chairman and CEO Charles Lowrey said in a news release. “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.”
If approved by regulators, the deal is expected to close Q1 2022. It will increase Empower’s retirement participants to 16.6 million and its retirement services recordkeeping assets to approximately $1.4 trillion. That covers about 71,000 workplace savings plans.
Note: Empower manages the retirement plans for Clarity Media Group, which owns The Denver Gazette.