Brookfield nears deal to buy insurer American Equity: reports

financialpost.com:

Canadian investment giant Brookfield is nearing a deal to acquire insurance firm American Equity Investment Life Holding Co., people with knowledge of the matter said.

Brookfield’s reinsurance arm has made a cash and stock offer that’s set to be recommended by the American Equity board, the people said, asking not to be identified because the information is private. American Equity, which has a market value of around US$3 billion, could make an announcement as soon as June 26, according to the people. The stock rose more than 20 per cent in after-market trading.

A transaction would cap several years of takeover interest in American Equity from various suitors and add to the US$15 billion in insurance company acquisitions announced globally over the past 12 months, data compiled by Bloomberg show. Brookfield Reinsurance Ltd. is already the biggest shareholder in West Des Moines, Iowa-based American Equity with a roughly 20 per cent stake, according to regulatory filings.

In December, American Equity rejected an unsolicited offer of Us$45 per share from rival insurer Prosperity Life Insurance Group that was backed by hedge fund Elliott Investment Management. Prosperity Life said in February it was withdrawing the proposal after American Equity refused to engage.

Brookfield’s offer is higher than the rebuffed proposal from Prosperity and values American Equity at a significant premium to its recent stock price, the people said. The exact bid couldn’t be learned. Representatives for Brookfield and American Equity couldn’t immediately be reached for comment.

Before rising late June 26, shares of American Equity had gained roughly 60 per cent under the tenure of chief executive officer Anant Bhalla, a former MetLife Inc. and