Prudential Financial Completes Sale to Fortitude Re of $31 Billion Block of Traditional Variable Annuities


NEWARK, NJ & JERSEY CITY, NJ–(BUSINESS WIRE)–Prudential Financial, Inc. (“Prudential”) (NYSE: PRU) and Fortitude Group Holdings, LLC, the parent company of Bermuda’s largest multiline reinsurer (“Fortitude Re”), today announced the completion of the sale to Fortitude Re of part of the former block of traditional variable annuities of Prudential.

Pursuant to the agreement announced on September 15, 2021, Fortitude Re has acquired one of Prudential’s subsidiaries, Prudential Annuities Life Assurance Corporation (“PALAC”) (to be renamed Fortitude Life Insurance & Annuity Company). The sale includes approximately $31 billion of in-force variable annuity account values, primarily comprised of traditional non-New York variable annuities with guaranteed living benefits that were issued by PALAC prior to 2011.

To ensure a consistent experience for clients, Prudential will continue to service and administer all block contracts following the transaction. Prudential will also continue to sell protected annuity solutions through other existing subsidiaries.

“This transaction is another key step in our journey to become a faster-growing, less market-aware and more agile company,” said Andy Sullivan, executive vice president of Prudential and head of US operations. “It delivers value to investors and ensures that our customers continue to be well served. The transaction also allows Prudential to focus more on expanding access to retirement security through the growth of protected earnings solutions, such as FlexGuard and FlexGuard Income.

“The closing of this transaction marks an important milestone for Fortitude Re,” said James Bracken, Managing Director of Fortitude Re.We have demonstrated to Prudential, its policyholders and other stakeholders that our commitment to capital strength, professional client experience and deep liability expertise can help our insurer clients achieve their strategic goals. We will continue to develop our capabilities in partnership with Carlyle, enabling us to accept industry-shaping transactions and continue our journey to become a leading solutions provider for global insurers.

Debevoise & Plimpton LLP acted as legal advisor to Fortitude Re. Sidley Austin LLP acted as legal advisor to Prudential and Goldman Sachs & Co. LLC served as exclusive financial advisor.

About Prudential Financial, Inc.

Prudential Financial, Inc. (NYSE: PRU), a leading global financial services and active global investment manager with over $1.5 trillion in assets under management as of December 31, 2021, does business in United States, Asia, Europe, and Latin America. Prudential’s diverse and talented employees help improve lives by creating financial opportunity for more people. Prudential’s iconic Rock symbol has stood for strength, stability, expertise and innovation for over a century. For more information, visit news.prudential.com.

About Fortitude Re

The Fortitude Re Group comprises Bermuda’s largest multiline composite reinsurer, with unique competitive advantages and expertise to design bespoke transactional solutions for legacy Life & Annuity and P&C lines. Fortitude Re is backed by a consortium of sophisticated investor groups led by The Carlyle Group and T&D Insurance Group. Fortitude Re holds approximately $48 billion in invested assets as of December 31, 2021. For more information, visit fortitude-re.com. Follow Fortitude Re on LinkedIn.

Prudential forward-looking statements

Certain of the statements included in this release, such as those regarding Prudential’s strategy with respect to the products it offers and the growth prospects and market sensitivity of its business, constitute forward-looking statements within the meaning of U.S. law. Private Securities Litigation Reform Act of 1995. Words such as “expects”, “believes”, “anticipates”, “includes”, “plans”, “assumes”, “estimates”, “projects”, “has l ‘intent to’, ‘should’, ‘will’, ‘shall’ or variations of these terms are generally part of forward-looking statements. Forward-looking statements are made based on management’s current expectations and beliefs regarding future developments and their potential effects on Prudential and its subsidiaries. There can be no assurance that future developments affecting Prudential and its subsidiaries will be those anticipated by management. These forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and certain important factors could cause actual results to differ, possibly materially, from the expectations or estimates reflected in these forward-looking statements. Certain important factors that could cause actual results to differ, possibly materially, from the expectations or estimates reflected in these forward-looking statements can be found in the “Risk Factors” and “Forward-Looking Statements” sections included in Prudential’s annual report on Form 10. -K. Prudential does not undertake to update any particular forward-looking statements included herein.

This press release does not constitute an offer to nominate or exchange any insurance policies or contracts, nor an offer to sell or a solicitation of an offer to buy any security.

Insurance and annuities are underwritten by the Prudential Insurance Company of America, Pruco Life Insurance Company (in New York, by Pruco Life Insurance Company of New Jersey), located in Newark, NJ (main office). Variable annuities are distributed by Prudential Annuities Distributors, Inc. (“PAD”), Shelton, CT. All are Prudential Financial, Inc. (“PFI”) companies, and each is solely responsible for its own financial condition and contractual obligations. Prudential Retirement Strategies is a Prudential Financial, Inc. business. For more information on FlexGuard, click here.

Prudential Annuities Life Assurance Corporation (to be renamed Fortitude Life Insurance & Annuity Company) (“PALAC”), Shelton, CT (main office) was acquired on April 1, 2022 by Fortitude Group Holdings, LLC, the parent company of the largest multi -line reinsurer (“Fortitude Re”). Following the acquisition by Fortitude Re, PALAC is not affiliated with PFI or any of its subsidiaries. A prudential entity will continue to manage and administer all PALAC contracts. PALAC variable annuities are distributed by PAD, Shelton, CT. PAD is 100% owned by PFI; PALAC is 100% owned by Fortitude Re; each is solely responsible for its own financial situation and contractual obligations.

PALAC is not licensed to do business in New York, effective December 31, 2015, which has had no impact on existing annuity contracts sold through PALAC.

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