Evercore Says Prudential Financial (PRU) Has The Capital to Fund Deal with ABC Life Insurance Co.

September 22, 2022 1:08 PM EDT
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Evercore Says Prudential Financial (NYSE: PRU) Has The Capital To Fund Deal with ABC Life Insurance Co.

Analyst Thomas Gallagher comments "We think PRU has enough excess capital to fund a potential deal of this size, though with weaker capital generation in 2022, sustaining share repurchase at a $1.5B level in 2023 could become more of a challenge unless PRU is able to free up more capital through additional risk transfer deals. While there are some geopolitical risks to consider, a bigger footprint in a faster growing market like China could be a good compliment to its slower growth but high quality Japanese business. With the disappointment of PRU’s last large deal, Assurance IQ in 2019, still fresh in investors’ minds, we think doing another $1B+ deal may be met with some initial skepticism, but our suspicion is that a traditional insurance deal like this could have a greater chance of succeeding."

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