(Reuters) -Canadian investment firm Brookfield’s reinsurance arm has offered to buy American Equity Investment Life Holding in a deal valued at nearly $4.3 billion, the annuities provider said on Tuesday.
Asset managers and private equity firms have been a conduit for publicly listed companies to exit the stock market at a time when few others are willing to do deals, as companies prioritize cost cuts over mergers and acquisitions.
Brookfield’s deal comes months after AEL rejected a nearly $4 billion takeover offer from insurance firm Prosperity Life and its principal shareholder Elliott Investment Management, saying the bid “significantly undervalued” the company.
Brookfield Reinsurance has offered $55 for each share of AEL it does not already own.
The offer price marks a 35% premium to AEL’s closing price on Friday, before media reports on a possible takeover proposal from Brookfield.
Shares of AEL were up 12% at $50.9 in premarket trading. The stock has lost 1% so far this year, as of last close.
Brookfield’s offer consists of $38.85 per share in cash and the rest in Brookfield Asset Management limited voting shares.
American Equity provides annuities – an insurance contract customers typically buy for a steady income stream after retiring.
(Reporting by Niket Nishant in Bengaluru; Editing by Krishna Chandra Eluri)
