Brookfield Re set to close AEL purchase

Brookfield Reinsurance expects to close its $3.4 billion purchase of American Equity Investment Life after the close trading tomorrow, the Bermuda-based re/insurer announced. 

Brookfield Re announced last July that it had agreed to buy the 80% of the US life and annuity insurer it did not already own in a deal which valued the company at $4.3 billion.

At the time of the agreement, each AEL shareholder was due to receive $55.00 per AEL share, consisting of $38.85 in cash and 0.49707 of a Brookfield Asset Management Ltd. share, having a value equal to $16.15. The offer of $55 per share represented a 35% premium to AEL’s closing price on June 23, 2023.

Sachin Shah, chief executive officer of Brookfield Reinsurance, said then: “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 $10 billion of capital since our inception, bringing our total insurance assets to over $100 billion, and we remain on track with our growth targets for the business. Brookfield Reinsurance remains well capitalized and committed to meeting the needs of its policyholders and clients.”  

The deal came after AEL rejected an unsolicited offer of $45 per share from rival insurer Prosperity Life Insurance Group that was backed by hedge fund Elliott Investment Management. 

The sale will close a busy period for Brookfield Re, which closed the $1.1 billion purchase of property casualty re/insurer Argo late last year and bought American National for $5.1 billion in 2022. 

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