U.S. insurers Equitable and Corebridge Financial have announced they will merge in an all-stock transaction, creating a combined entity valued at $22 billion. The new company will focus on retirement, life insurance, and asset management, boasting over $1.5 trillion in assets under management and administration and serving more than 12 million customers. Insurers are increasingly seeking scale to enhance competitiveness, diversify their business operations, and strengthen their market position, particularly in the growing retirement and wealth management sectors.
According to Equitable CEO Mark Pearson, the merger will create a strong competitive position and accelerate growth across retirement, life, and institutional markets, as well as in asset and wealth management. Under the terms of the agreement, each outstanding Corebridge share will be exchanged for one share of the new parent company, while each Equitable share will be exchanged for 1.55516 shares. The combined companies expect to originate approximately $75 to $80 billion in retirement liabilities annually, and over time, $100 billion of Corebridge’s assets will be moved to AllianceBernstein, creating an almost $1 trillion asset manager.
Corebridge, which was carved out of AIG in 2022, is a prominent U.S. provider of retirement and insurance products. Equitable, which owns asset manager AllianceBernstein, offers retirement and protection strategies. The deal is projected to increase earnings by more than 10% by the end of 2028, with completion targeted for the end of 2026. The combined entity, to be headquartered in Houston and operate under the Equitable name, is expected to generate over $5 billion in operating earnings.
Upon completion of the merger, Corebridge shareholders will hold approximately 51% of the combined company, with Equitable investors holding roughly 49%. Corebridge CEO Marc Costantini will lead the combined company, while Equitable CEO Mark Pearson will become executive chair. The companies have set a breakup fee of $475 million should the deal not proceed. Morgan Stanley advised Corebridge, and Goldman Sachs advised Equitable.
