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Nippon Life Acquires 20% Stake in Corebridge Financial for $3.8 Billion

Nippon Life acquires 20% of Corebridge from AIG for $3.8 billion, marking its largest US market expansion move.

By Bill Bullington

5/16, 05:55 EDT
American International Group, Inc. New
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Key Takeaway

  • Nippon Life acquires a 20% stake in Corebridge Financial from AIG for $3.8 billion, marking its largest US market expansion.
  • The deal, closing by Q1 2025 with shares priced at $31.47 each, aims to strengthen Nippon Life's foothold in the US retirement solutions and insurance sectors.
  • Corebridge, with over $390 billion assets under management as of March 31, 2024, to benefit from strategic partnership and expanded capabilities.

Strategic Expansion into the US Market

Nippon Life Insurance Co., Japan's largest insurer, has announced a significant move to expand its presence in the United States by acquiring a 20% stake in Corebridge Financial Inc. This acquisition, valued at approximately $3.8 billion in cash, represents Nippon Life's largest deal to date. The shares are being purchased from American International Group Inc. (AIG), which retains ownership of over 50% of Corebridge. This strategic partnership aims to provide Nippon Life with a substantial foothold in the US market, leveraging Corebridge's strong position in retirement solutions and insurance products.

AIG's CEO, Peter Zaffino, emphasized the importance of reducing its stake in Corebridge as a key priority for the year, highlighting the strategic nature of this divestiture. Corebridge, known for its significant role in the individual retirement market in the US, benefits from gaining a new anchor investor through this transaction.

Financial and Legal Framework

The transaction is set to close by the first quarter of 2025, pending regulatory approval and the satisfaction of customary closing conditions. The agreed purchase price for the approximately 120 million shares of Corebridge's common stock is $31.47 per share, totaling an aggregate purchase price of $3.8 billion. Post-transaction, AIG has committed to maintaining a 9.9% ownership stake in Corebridge for two years following the closing.

Legal counsel for AIG in this deal was provided by Wachtell, Lipton, Rosen & Katz, with J.P. Morgan Securities LLC acting as the financial advisor. This strategic sale is anticipated to not only benefit Nippon Life by expanding its global footprint but also to add meaningful value to Corebridge as a strategic partner.

Corporate Profiles and Market Impact

Corebridge Financial, with over $390 billion in assets under management and administration as of March 31, 2024, stands as one of the largest providers of retirement solutions and insurance products in the United States. This partnership is expected to bolster Corebridge's capabilities and market presence further.

Nippon Life Insurance Company, established in 1889, is Japan's leading private life insurer and a key player in the global insurance market. With a focus on life insurance and asset management, Nippon Life aims to provide peace of mind through a wide range of products and services. This acquisition marks a significant step in Nippon Life's strategy to pursue growth opportunities both domestically and internationally.

Management Quotes

  • A spokesperson for Nippon Life:

    "Japan’s largest insurer plans to acquire shares from American International Group Inc. which owns more than 50% of Corebridge."

  • Peter Zaffino, CEO of AIG:

    "Reducing its stake in Corebridge remains a top priority this year."