© Reuters. Brookfield nears acquisition of American Equity, shares jump 10%
Canadian investment firm Brookfield (TSX:) made an offer to acquire American Equity Investment Life (NYSE:) for $55.00 per each AEL share. The offer values AEL at about $4.3 billion.
Shares in the insurance company surged yesterday on a Bloomberg News report discussing the imminent bid. While the stock gained nearly 11% on Monday, AEL shares are up an additional 13% in pre-market Tuesday after Brookfield tabled its offer. The stock is now indicated to open at around $51 apiece.
As consideration for each AEL share, shareholders will receive $38.85 in cash and a number of Brookfield class A limited voting shares having a value equal to $16.15 based on the unaffected 90-day VWAP as of June 23, 2023, resulting in total consideration of $55.00 per AEL share, the investment titan said today.
Brookfield Reinsurance already holds a 20% stake in American Equity and is the biggest shareholder in the company.
This transaction comes after several years of takeover interest in American Equity from various potential buyers. In December, American Equity rejected an unsolicited offer from Prosperity Life Insurance Group, supported by Elliott Investment Management.
Brookfield’s offer is higher than the previous proposal and values American Equity at a premium.
(Additional reporting by Senad Karaahmetovic)
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