Brookfield Reinsurance to acquire AEL for $4.3bn

Written by Dan McGrath

5/7/2023

Brookfield Reinsurance has entered into an agreement to acquire American Equity Investment Life Holding Company (AEL) for approximately $4.3bn.

As part of the agreement, AEL shareholders will receive $38.85 in cash, as well as a number of Brookfield Asset Management (BAM) class A limited voting shares, valued at $16.15, totalling the aggregate amount of $55 per share.

Following the closure of the deal, Brookfield expects to maintain AEL’s headquarters in Des Moines, Iowa and the growth in the AEL platform over time should increase net jobs in Iowa.

Furthermore, Brookfield Reinsurance intends to continue AEL’s focus on alternative asset strategies and expects BAM will manage a significant proportion of AEL’s assets. As a result,
AEL will gain focus on BAM’s leasing direct origination platforms and asset management capabilities while maintaining its high-quality bias and investment grade focus.

President and chief executive officer at AEL, Anant Bhalla, said: “We are pleased to have reached this agreement with Brookfield Reinsurance and believe this transaction provides an excellent outcome for all AEL shareholders, policyholders and other stakeholders. The significant premium that will be delivered to shareholders as a result of this transaction is a testament to our strong performance and AEL’s successful transformation under the AEL 2.0 strategy into an asset light insurer and asset manager.

“The transaction represents an opportunity for AEL shareholders, through the BAM Shares, to remain invested in a market leading global alternative asset manager. I couldn’t be more excited about the potential opportunities for our people and benefits for policyholders as part of a preeminent global financial institution.”

Non-executive officer of Brookfield Reinsurance, Sachin Shah, added: “This transaction represents an important step in the continued growth of our insurance business, further diversifying, and scaling, our insurance capabilities, and is a direct result of the partnership we have developed with AEL since our initial investment in 2020. With this transaction we have now deployed or committed over $10bn of capital since our inception, bringing our total insurance assets to over $100bn, and we remain on track with our growth targets for the business. Brookfield Reinsurance remains well capitalised and committed to meeting the needs of its policyholders and clients.”

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