Brookfield Reinsurance moves from Argo buy to $3.4bn AEL take-over bid

Brookfield Reinsurance, already set for a $1.1 billion cash purchase of  Argo Group, has now set its eyes on annuity provider American Equity Investment Life (AEL) and placed a $3.41 billion bid for the roughly 80% it does not own.

Brookfield is bidding on just over 62 million outstanding shares for which it is ready to pay $2.41 billion cash and the remaining $1 billion in shares of its parent, Brookfield Asset Management. The deal values the whole of AEL at $4.29 billion. The bid is a 35% premium to where shares traded late Monday (June 26).

AEL responded with the reserve typical of such deals. “The Board will carefully review Brookfield Reinsurance’s proposal in accordance with its fiduciary duties,” management said.

AEL has not always been so reserved in its relations with Brookfield, to whom it has previously issued shares.

Brookfield Reinsurance “has become our competitor through its insurance acquisitions and developments in its publicly-described strategies,” AEL management last lamented in its Q1 report.

“As a result, Brookfield Reinsurance has become increasingly and publicly hostile toward our strategy.”

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