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Brookfield Affiliate Agrees to Pay $5.1B for American National

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What You Need to Know

  • Brookfield's reinsurance affiliate will pay cash for American National.
  • Brookfield Re says it wants to keep expanding American National's business.
  • American National will keep its headquarters in Galveston, Texas, and its current management.

A reinsurance affiliate of Brookfield Asset Management could soon be a major player in the U.S. individual life and annuity markets.

The affiliate, Brookfield Asset Management Reinsurance Partners, announced Monday that it has agreed to pay $5.1 billion in cash for American National Group, through a deal structured as a merger.

Members of the American National board have already given the deal unanimous approval, according to Brookfield.

The companies hope to close on the deal by June 30, 2022.

The Players

Brookfield is a Toronto-based asset manager with about $600 billion in assets under management.

American National is a Galveston, Texas-based company that was founded in 1905 by William L. Moody Jr. Shares of the company’s stock trade on the Nasdaq under the symbol “ANAT,” but members of the Moody family continue to control the company through a foundation and a trust.

American National is a significant issuer of life insurance and annuities as well as of property and casualty insurance products in all 50 states and the District of Columbia.

Wink Inc. ranked it as being the 13th biggest issuer of individual whole life and the 31st biggest issuer of individual deferred annuities in the United States in the first quarter.

American National released earnings for the second quarter Monday. It reported $228 million in net income for the quarter on $1.1 billion in revenue, compared with $211 million in net income on $1.1 billion in revenue for the first quarter of 2020.

The company’s four life insurance company subsidiaries all have A ratings from A.M. Best.

What It Means

Brookfield appears to want to maintain American National’s operations largely as they are and build a bigger business.

Brookfield said it intends to keep the company’s headquarters in Galveston, to keep the company’s regional offices open and to maintain the company’s community involvement.

Sachin Shah, Brookfield Re’s CEO, said in a statement that the transaction “represents a significant milestone in the continued expansion of our insurance business.”

Brookfield Re wants to partner with American National’s management team, employees and distribution partners, Shah said.

Jim Pozzi, American National chairman, president and CEO, called the deal an “energizing moment.”

“Brookfield Reinsurance has been very clear: They want us to continue to grow our business, together with our leadership team and our excellent team of employees and distribution partners,” Pozzi said.

(Image: Shutterstock)