TPG (NASDAQ:TPG) outlined a newly announced long-term strategic partnership with Jackson Financial on a conference call, describing the arrangement as a key step in the firm’s efforts to expand its credit platform and deepen its insurance-focused asset management business.
Chief Executive Officer Jon Winkelried said TPG has spent recent years “diversifying and scaling” its credit platform, extending the duration of its capital sources, and building capabilities to serve insurance clients at scale. He framed the Jackson partnership as an “important step” in the evolution of that strategy, following what he called a breakout year for TPG Credit in 2025. Winkelried said the firm expects to report approximately $20 billion of credit capital raised for the full year on its fourth-quarter earnings call next month, which he said would represent a 60% increase from 2024.
Investment management agreement targets $12 billion minimum
Chief Financial Officer Jack Weingart provided additional structural details. The agreement includes a ramp schedule requiring a minimum of $4 billion in assets under management after two years and $12 billion within five years of closing. Weingart emphasized that all assets under the IMA will be fee-paying AUM, with market-based fees by asset class and a minimum management fee of 50 basis points for the duration of the partnership. The IMA has a 10-year initial term with automatic one-year renewals through year 15.
Asked about how the 50 basis point minimum fee could evolve, Weingart said the overall fee rate will be a weighted average based on allocations, with the minimum acting as a floor in asset classes where typical fees might otherwise be below that level. He added that TPG’s accretion calculations assume only the 50 basis point minimum.
Equity investments designed to align incentives
The partnership includes cross-investments intended to align the two firms. Weingart said TPG will invest $500 million in Jackson common stock based on the unaffected volume-weighted average price during the 30 days preceding signing, representing approximately 6.5% pro forma ownership. He said TPG expects to fund the investment through its revolving credit facility, which had $1.75 billion of undrawn capacity at the end of the fourth quarter.
Weingart also described flexibility around monetization. Following the second anniversary of closing, TPG may begin to monetize gains in its Jackson position, and following the fifth anniversary it may begin selling down its initial stake. However, he said TPG agreed to hold at least $100 million of Jackson stock for the duration of the partnership.
In the other direction, TPG will issue $150 million of its common stock to Jackson. Weingart added that if fee-earning AUM managed by TPG for Jackson reaches at least $20 billion by the 10th anniversary of closing, Jackson will be eligible for an additional $150 million issuance of TPG common stock.
Financial impact and closing timeline
Weingart said the partnership is expected to be accretive to TPG’s fee-related earnings per share beginning in the fourth quarter of 2026 and accretive to after-tax distributable earnings per share beginning in fiscal year 2027. He characterized the arrangement as providing “long-term predictable fee revenue” and said scaling the mandate should carry high contribution margins, given existing credit infrastructure.
The transaction is subject to customary closing conditions, and Weingart said the companies expect to close in the first quarter of the year.
Origination capacity and strategy expansion
During the question-and-answer session, Winkelried said TPG is “highly confident” in its ability to originate assets for the Jackson mandate as well as for other client relationships. He pointed to the firm’s history in structured credit and described how growth in TPG’s capital base has enabled it to expand relationships on the origination side and pursue larger opportunities. He added that greater “visibility and certainty” of capital flows can improve TPG’s positioning with counterparties.
On whether TPG might acquire additional origination platforms, Winkelried said the firm does not have specific plans to buy finance companies to secure origination, citing existing relationships and market presence. He said TPG would not rule out evaluating a “flow partnership” if it made economic sense.
On direct lending, Winkelried said the Jackson capital is expected to begin flowing into Twin Brook, and he indicated there could be opportunities over time to support expansion “into the next level of lending.” He also said TPG would provide more specifics on a future earnings call about opportunities in larger parts of the market.
Josh Evans, partner and head of corporate development, said discussions have already begun around other strategies that could be included within the overall agreement beyond the initial investment-grade asset-based finance and direct lending allocations, noting the economic incentives to expand beyond $12 billion.
Insurance channel focus and potential for more partnerships
Winkelried highlighted Jackson as a “top-10 U.S. retail annuity provider” with $350 billion in assets under management, more than 500 broker-dealer partners, and 120,000 appointed advisors. He also said Jackson has returned nearly $2.5 billion to shareholders through dividends and share repurchases since becoming an independent public company four years ago.
Winkelried also pointed to TPG’s asset-based finance platform, which he said has participated in over $150 billion of investment activity since 2014 through relationships with more than 50 origination partners and counterparties. He said firm-wide commitments from insurance clients have increased more than 60% over the past two years, and that insurance clients represented about 20% of total credit fundraising since the start of 2024, including 40% for asset-based finance.
When asked if this type of deal could serve as a template for other insurance partnerships, Winkelried said the Jackson partnership is non-exclusive and that TPG intends to keep expanding relationships with insurance clients. He said the firm expects other balance sheet-light, fee-related earnings-centric opportunities to arise and that TPG plans to pursue them, without committing to a specific timeline.
About TPG (NASDAQ:TPG)
TPG Inc (NASDAQ: TPG) is a global alternative asset management firm that invests across a range of strategies including private equity, growth equity, real assets, credit and hedge funds. Founded in 1992 as Texas Pacific Group, the firm has expanded its product set to serve a broad set of institutional and individual investors through commingled funds, separately managed accounts and other customized investment vehicles.
TPG operates investment platforms that target buyouts, growth-stage companies, real estate and credit opportunities, and it has developed dedicated thematic and impact vehicles such as the TPG Rise Fund to pursue social and environmental outcomes alongside financial returns.
