GWO grows in the U.S.

Article Excerpt

GREAT-WEST LIFECO, $26.02, is still a hold. The insurer (Toronto symbol GWO; shares o/s: 926.3 million; Market cap: $24.2 billion; TSINetwork Rating: Above Average; Yield: 6.7%; www.greatwestlifeco.com), through its U.S.-based Empower Retirement business, will now buy the retirement services unit of Massachusetts Mutual Life Insurance Company. That firm manages over 26,000 pension plans covering 2.5 million participants; it has $167 billion U.S. in assets under management. Following the purchase, Empower will administer 67,000 plans (covering 12.2 million participants) with assets of $834 billion U.S. Great-West will pay Massachusetts Mutual $3.35 billion U.S. ($4.4 billion Canadian) for this business when it completes the transaction in the fourth quarter of 2020. The company expects the new business will lift its annual earnings per share, excluding integration costs, by 5% in 2021 and 8% in 2022. However, expanding by acquisition still adds risk. Great-West Lifeco remains a hold. hold. …