BY Richard Summerfield
Apollo Global Management Inc has agreed to acquire Athene Holding Ltd in an all-stock deal that values the annuity business at around $11bn.
The deal is expected to close in January 2022, the companies said in a statement on Monday. Apollo was already the annuity seller’s biggest shareholder, with the firm and related entities owning a 35 percent stake in the company.
Under the terms of the deal, each Athene common share will be exchanged for 1.149 shares of Apollo common stock, with Apollo shareholders owning about 76 percent of the combined company once the transaction is completed.
By merging with Athene, the life insurance company Apollo established at the height of the financial crisis, the alternative asset manager will be transformed into a financial conglomerate with a market capitalisation worth almost $30bn.
“This merger is all about alignment between Apollo and Athene, amongst Apollo’s stockholders and with our limited partners,” said Marc Rowan, co-founder and incoming chief executive of Apollo. “For Apollo and Athene, we will have total alignment to optimize our strategy and allocate capital efficiently, which will include rapidly scaling our capability to originate attractive risk/reward assets, which are the limiter of growth for both firms. We have also created alignment among all our stockholders who will share in the upside of a larger, more liquid company with leading corporate governance. And it further aligns interests with our fund investors, giving us a bigger balance sheet to invest alongside clients in our various fund products.”
“Today’s announcement reflects the strength and strategic nature of our longstanding mutually beneficial relationship with Apollo – one which has already created enormous value for each other and our respective constituents,” said Jim Belardi, chairman and chief executive of Athene. “After carefully reviewing Athene’s options to unlock value for shareholders, Athene and Apollo determined that the potential of a fully aligned business would be significantly greater than a sum-of-the-parts.
“Coming together in this merger is a logical and exciting next step that will simplify our relationship while driving significant strategic and financial benefits in both the immediate and long-term future,” he added.
News: Apollo Global to buy annuities provider Athene in $11 billion deal