Empower, the US subsidiary of Great-West Lifeco, has entered into a definitive agreement to acquire Milliman's retirement plan and benefits administration business for US$340 million, in a transaction expected to close in the second half of 2026 subject to regulatory approvals.
The acquired business provides defined contribution, defined benefit and health and welfare administration services to corporate, public sector, trade labour union, multi-employer and non-profit clients, with approximately US$130 billion in client assets across 1.5 million participants. On a pro forma basis, the deal brings Empower's workplace solutions platform to 21 million participants and US$2.0 trillion in client assets.
Empower plans to finance the transaction with existing cash resources, with US$244 million payable at closing and the balance paid over five years. Great-West said there is no pro forma impact to its holding company cash balance of US$2.1 billion or its leverage ratio of 28% as at March 31, 2026, and that it retains financial flexibility for share repurchases in 2026 at a level similar to 2025, as well as for additional M&A.
The Milliman business generated approximately US$120 million in revenue in 2025. Great-West expects the transaction to be accretive to base earnings in the first year, generate an internal rate of return in the mid-teens, and deliver approximately US$20 million in cost synergies within three years, against total integration costs of approximately US$50 million including technology integration.
David Harney, president and CEO of Great-West, said the acquisition reflects a focus on adding scale to high-quality, capital-efficient platforms while generating attractive long-term returns - the two strategic criteria that the mid-teens IRR target and first-year earnings accretion are designed to satisfy simultaneously.
The deal fits a wider pattern of Canada's largest insurers using acquisitions to scale their businesses outside their home market. Sun Life recently completed the acquisition of the remaining equity interests in BentallGreenOak and Crescent Capital Group for a combined US$1.77 billion and separately announced its intention to fully acquire Bell Partners, a US multifamily real estate investment manager. Manulife has pursued its own international expansion, including a joint venture with India's Mahindra & Mahindra to grow its distribution in that market.
For Great-West specifically, the US segment anchored by Empower already contributes approximately 26% of adjusted earnings, while Canada remains the largest contributor at roughly 31%. The Milliman acquisition adds weight to the US side of that balance, continuing a trend in which Canada's large insurers increasingly look abroad rather than to domestic growth alone to expand scale.
The acquired book operates entirely under US regulatory frameworks, but the deal carries relevance for Canadian benefits and pension professionals. As Empower's participant count and asset base grow, its scale becomes an increasingly significant comparison point for Canadian pension administrators competing for large, multi-jurisdictional plan sponsor mandates - even where the underlying regulatory regimes on each side of the border remain distinct.
