What You Need to Know
- The deal has been in the works since March 2020.
- Prudential P.L.C. says it wants to focus on opportunities in Asia and Africa.
- Jackson has borrowed $2.35 billion to push up the capital level at Jackson National Life.
Jackson Financial Inc. — a leader in the U.S. individual variable annuity market — announced today that it has completed the process of separating from its former parent, Prudential PLC of London, through a demerger.
The U.K. Prudential, which has no connection with the U.S. Prudential Financial, announced in March 2020 that it intended to separate from Jackson in an effort to focus on insurance and annuity opportunities in Asia and Africa.
Many publicly traded financial services companies in Europe and North America have been selling or spinning off life and annuity businesses because of concerns about the effects of new accounting rules on the businesses’ appeal to investors.
Jackson said today, in the separation completion announcement, that it is “a leading U.S. retirement services provider” and that it intends to deliver “consistent profitable growth, enabling strategic reinvestment in the business and returning capital to shareholders.”
Laura Prieskorn, the Jackson’s CEO, said the company’s mission is to help people achieve financial freedom for life.
“As a leader in the U.S. retail annuity market, we are entering this new chapter on solid financial footing, with a focused strategy to drive growth and create value for our customers, associates and shareholders as a public company.”
Jackson Financial Inc.
Jackson is the Lansing, Michigan-based parent of Jackson National Life Insurance Company.
Jackson ranked first in terms of U.S. traditional individual variable annuity sales in the first quarter, with about $4.6 billion in new variable annuity sales, according to the Secure Retirement Institute.
The second-ranked issuer of traditional individual variable annuities reported just $2 billion in new traditional variable annuity sales.
Jackson ended the first quarter with a total of about $355 billion in assets and $8.8 billion in book value, according to a recent company presentation.
The company told securities analysts that it has a healthy book of annuity business, with no buyout offers intended to induce lapses or increased benefit fees on the in-force block.