Prudential Financial is entering Mexicos private pension management industry through a joint venture in which it will have acquire slightly less than 50% in the nations ninth largest private pension manager, the company announced.
Pending regulatory approval, Prudential will acquire IXE Grupo Financieros stake in Afore XXI. Afore XXI is a joint venture between IXE and Instituto Mexicano del Seguro Social (IMSS), the national government agency that oversees health and retirement benefits for Mexican workers.
Prudential already has a significant presence in Mexico with its joint venture with Prudential Apolo, the countrys third largest independent investment management firm, according to the Mexican Stock Exchange. Manuel Somoza, president of Prudential Apolo, will be one of Prudentials representatives on Afores board, according to the firm.
Prudential is hoping the Afore deal will go through at the beginning of the second quarter, a company spokeswoman said.
"Prudential Financial sees enormous opportunity in entering the private pension industry in Mexico," said Stephen Pelletier, president of Prudentials international capital group, in a statement. "Afore XXI has a large customer-base through its affiliate system, a distribution network that covers more than 30 states in Mexico, a talented management team and its relationship with IMSS, which has been responsible for overseeing retirement policy in Mexico for many years."