KKR to acquire US life insurance company Global Atlantic Financial for $4.4bn

KKR acquisition of Global Atlantic Financial : Private equity firm KKR & Co. has signed a deal worth around $4.4 billion to acquire US retirement and life insurance company Global Atlantic Financial Group, which claims to be one of the largest providers of fixed-rate and fixed indexed annuity providers in the US.

Global Atlantic Financial Group is said to offer retirement and life insurance products to more than two million policyholders.

The company’s annuities for individuals are offered through a network of insurance agencies, banks, and broker-dealers. Additionally, the company provides life insurance solutions for individuals and corporates.

Global Atlantic Financial, which is among the major players in the institutional channel, also provides bespoken reinsurance solutions to its life and annuity company clients. It was founded originally in 2004 as Goldman Sachs Reinsurance Group (GSRG) and about nine years later, was spun out by Goldman Sachs to be renamed as Global Atlantic Financial.

Commenting on KKR acquisition of Global Atlantic Financial, Allan Levine – Chairman and CEO of Global Atlantic Financial, said: “We are thrilled to have a new, long-term partner in KKR.

“With its global presence, investment acumen and long-term focus, we believe we will be even better positioned – financially and strategically – both to help Americans address the financial challenges they face today and to help our institutional channel clients achieve their strategic, risk, and capital management goals.”

The acquisition means Global Atlantic Financial is expected to get access to KKR’s direct origination platforms and asset management capabilities while maintaining its high-quality bias and investment-grade focus.

KKR further said that the acquisition of Global Atlantic Financial is a significant and natural extension of its existing insurance business, which includes handling $26 billion of assets under management on behalf of insurance firms across our strategies and products.

The private equity firm said that, as of 31 March 2020, its assets under management would move up from $207 billion to $279 billion following the acquisition.

Upon completion of the acquisition, Global Atlantic Financial will continue operations as a standalone business with its existing brands. The retirement and life insurance company will continue to be managed by its existing senior leadership team led by its present CEO Allan Levine.

Joseph Bae and Scott Nuttall – Co-Presidents and Co-Chief Operating Officers of KKR, commenting on KKR acquisition of Global Atlantic Financial, said: “This transaction is highly strategic for KKR — it meaningfully expands our base of permanent capital, further diversifies and scales our business, and significantly grows our position within the insurance industry, which has been increasing its exposure to alternative investment strategies. Insurance providers play a critical role in supporting the financial security for millions of individuals.

“This transaction positions KKR to support Global Atlantic policyholders through our global network and asset management and origination capabilities.”

KKR acquisition of Global Atlantic Financial is subject to receipt of regulatory approvals and satisfaction of certain other customary closing conditions, following which, it is expected to be wrapped up in early 2021.