Corebridge Financial Inc’s life insurance and pensions division AIG Inc raised $1.68 billion on Wednesday in its largest initial public offering (IPO) this year despite market volatility, breaking a semi-annual lull in major listings.
AIG sold 80 million shares of Corebridge for $21 a share, the lowest price in its target range of $21 to $24 a share.
The IPO values Corebridge at $13.6 billion.
All proceeds from the IPO will go to AIG, and the new company is not raising new capital.
The sale of Corebridge shares will kick-start the IPO out of the doldrums. Russia’s invasion of Ukraine and soaring inflation, which has given rise to interest rates, have activated stock market volatility, against which the listing of many companies has been delayed.
Based on data from Dealogic, this is the worst year for IPOs in the United States in more than two decades. Companies have now raised about $18 billion this year, compared to more than $231 billion in the same period last year.
Other companies such as Reddit and software company ServiceTitan have delayed IPO plans this year due to volatility.
Corebridge’s $1.7 billion offering is the largest U.S. IPO this year, topping the listing of private equity firm TPG Inc. by $1.1 billion in January.
In early announcements, AIG said it would spin off its life insurance and pensions division and make it a new public company in 2020, allowing the insurance giant to focus on its property and casualty business.
Such actions show that insurers are willing to focus on offering a single product given their different shareholder return profiles. A trend that AIG has successfully fought for years.
After selling a 10% stake in private equity firm Blackstone Inc for $2.2 billion last year, AIG filed a bid for Corebridge in March. The company planned to complete the listing by the end of June, but market volatility interrupted them forcing them to postpone the process.
AIG’s subsidiary in Houston offers pension solutions and insurance products in the US.
AIG will control nearly 78% of the company’s shares after the listing, with Corebridge trading on the New York Stock Exchange under the symbol “CRBG”.
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