Prosperity Group Holdings has announced it is withdrawing its proposal to acquire American Equity, with the firm noting that it has no interest in continuing to pursue its proposed transaction at this time.
In December last year, American Equity confirmed that its Board of Directors had reviewed and rejected an unsolicited, non-binding proposal from Prosperity and its principal shareholder, Elliott Investment Management, to acquire it in an all-cash transaction at $45.00 per share.
The initial proposal was received by American Equity on December 8, 2022, and rejected on December 12, 2022.
Prosperity then sent a second letter restating the same price and economic terms On December 19, 2022. American Equity reiterated its rejection on December 20, 2022.
Prosperity later released a statement affirming that it remained interested in acquiring the life and annuity insurer, despite the rejection of the takeover bids.
Reinsurance News has now learned that the Prosperity has withdrawn its proposal, providing the statement, “Given American Equity’s refusal to engage and our desire to proceed only on a constructive basis, Prosperity has no interest in continuing to pursue our proposed transaction at this time.”
Meanwhile, in its Q4 2022, results, American Equity reported a net loss available to common stockholders of $29.4m, compared to a net income of $82.2m, for Q4 of 2021.
American Equity also announced in this earning period that it had ceded $352m of flow reinsurance to Brookfield Re and $4.3bn of GAAP reserves, including $3.8bn of account value, in a new strategic partnership with 26North Re increasing “fee-like” revenues and growing account value subject to recurring fees to $9.6bn.
