KKR & Co. Inc. is making a big leap into the U.S. life and annuity market.
The New York-based private equity firm has agreed to buy Global Atlantic Financial Group Ltd. from its shareholders.
KKR plans to pay an amount equal to Global Atlantic’s book value, as of the date of the closing, to acquire the stock, KKR and Global Atlantic announced today.
Book value equals the estimated market value of a company’s assets, minus the company’s intangible assets, such as goodwill, and minus the company’s liabilities. At the end of the first quarter, Global Atlantic had a book value of about $4.4 billion.
- Links to KKR-Global Atlantic deal resources, including an audio recording of a KKR conference call meeting for investors, are available here.
- An article about a KKR assessment of the U.S. life and annuity market is available here.
KKR said that it would operate Global Atlantic as a separate business, and that Global Atlantic would keep its current management team and brands.
KKR would become Global Atlantic’s investment manager.
More Deal Details
KKR said it would pay for the deal with a combination of cash on hand, proceeds from minority co-investors and the issuance of new KKR debt or KKR stock.
KKR would not put any client funds into the deal, but it would create a vehicle that outside investors could use to invest in the deal alongside KKR.
KKR and Global Atlantic need to get approvals from regulators before they can complete the deal. They hope to complete the deal in early 2021.
The Players’ History
Goldman Sachs formed Global Atlantic in 2004 and converted it into an independent company in 2013.
Global Atlantic made its first big splash in acquisitions in 2005, when it acquired Allmerica Life.
In 2013, Global Atlantic acquired Forethought Life Insurance Company, the company that ended up with Hartford Financial Services Group Inc.’s formidable annuity origination business.
Global Atlantic also acquired a U.S. arm of Aviva PLC in 2013, and turned that business into Accordia Life and Annuity Company.
Global Atlantic has its headquarters in Hamilton, Bermuda.
KKR was founded in 1976, as Kohlberg Kravis Roberts & Co.