Jackson announces strategic transaction with Athene
Jackson announced it has entered into an agreement with Athene Holding, a provider of retirement savings products, to fully reinsure $27.6 billion of Jackson’s in-force book of fixed and fixed index annuity liabilities in exchange for approximately $1.25 billion in ceding commission.
Athene will also invest $500 million of capital into Jackson in return for a 9.9 percent voting interest corresponding to a 11.1 percent economic interest in Jackson. The combined effects of the investment and reinsurance transactions are estimated to increase Jackson’s Risk-Based Capital (RBC) ratio by approximately 80 percentage points.
“Today’s transactions with Athene, a leading franchise in the retirement services market, further strengthen our capital position and enhance our ability to grow. We value Athene’s investment in Jackson, which is aligned to our common goal of serving the growing population of American savers transitioning into and through retirement.” – Michael Falcon, Chief Executive Officer of Jackson.
Under the terms of the reinsurance agreement, Jackson will retain account administration and service of the annuity policies. Jackson remains focused on the continued growth of both its fixed and variable annuity businesses and plans to introduce new products and continue expanding its distribution network to achieve commercial diversification and meet evolving customer needs.
“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. This agreement is a key step forward in meeting our strategic objectives for Jackson.” – Mike Wells, Group Chief Executive of Prudential.
“We are very pleased to announce this mutually beneficial transaction in coordination with Jackson and its parent, Prudential plc. As top annuity providers focused on serving the U.S. retirement marketplace, we are excited to bring these two leading franchises together through a large-scale reinsurance transaction that includes a new investment in Jackson by Athene.” – Jim Belardi, Chief Executive Officer of Athene.
The reinsurance transaction is effective from June 1, 2020
