Legal & General to Sell 20% Stake in PRT Business to Japanese Insurer

With an eye on continuing to offer security to retirees in pension risk transfer deals, Legal & General Group PLC announced Friday the sale of its U.S. insurance business to Japanese annuity firm Meiji Yasuda Life Insurance Co. in a $2.3 billion deal that includes the firm’s protection business and one fifth of its U.S. PRT business.

Meiji Yasuda will wholly acquire Legal & General’s traditional U.S. insurance business and will take a 20% stake in the company’s U.S. PRT business. In addition, Meiji Yasuda will acquire a 5% stake in Legal & General.

“This is an exciting milestone for the U.S. pension risk transfer business. The strategic partnership with Meiji Yasuda combines the strength and experience of two industry-leading companies to support our continued growth in the U.S. PRT market,” said George Palms, CEO of Legal & General Retirement America, the firm’s U.S. PRT division, in a statement. “This partnership marks a new chapter for our organization, and our priority remains steadfast: to ensure a secure retirement for our annuitants and provide exceptional service to our clients.”

Approximately 400 million pounds ($497.51 million) from the proceeds of the transaction will be invested in Legal & General’s U.S. PRT business, according to the announcement. The two firms will partner in asset management by outsourcing pension risk transfer and protection assets to Legal & General.

“This strategic partnership brings together two highly complementary global businesses, with a shared ambition for growth, and will enable us to capitalize on the large market opportunities in U.S. Pension Risk Transfer while driving scale and profitability in global asset management,” said Legal & General Group CEO António Simões in a statement.

Insurance firm Nationwide expected the U.S. PRT market exceeded $50 billion in 2024 and projected continued momentum in 2025.

The two firms will also establish a long-term partnership in global private assets, including significant co-investment in Legal & General’s private asset capabilities, which include real estate equity, private credit, infrastructure equity and venture capital.

The transaction is expected to close at the end of 2025, pending regulatory approval. According to a December 2024 report from Legal & General, the firm expects its largest recorded PRT volume in the U.S. and Canada this year. The firm is expected to write 10.5 billion pounds of PRT volume in the U.K. and another 2.1 billion pounds internationally, including the U.S. market.

Headquartered in Tokyo, Meiji Yasuda is the oldest and one of the major life insurance providers in Japan. The company also has insurance operations in the U.S., Poland, Thailand and China, deal materials stated.