Acquisition Accelerates Aspida’s Growth Strategy in Life Reinsurance with the Launch of Aspida Re
Aspida Re to Enter into Ongoing Strategic Flow Reinsurance Agreement with F&G
Ares Management Corporation ("Ares") (NYSE: ARES) and its indirect subsidiary Aspida Holdings Ltd. ("Aspida") jointly announced today an agreement by Aspida to acquire all outstanding common shares in F&G Reinsurance Ltd (the "Company"), a Bermuda-domiciled life & annuity reinsurer with approximately $2 billion in invested assets as of June 30, 2020. The Company is being acquired from FGL Holdings ("F&G"), a subsidiary of Fidelity National Financial, Inc. ("FNF") (NYSE: FNF). Following closing, the Company expects to continue to operate as a reinsurance company under the Aspida brand ("Aspida Re").
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With support from Ares Insurance Solutions ("AIS"), this transaction advances a critical element of Aspida’s overall growth strategy to capitalize on the growing retirement market and increasing demand for guaranteed insurance products. Aspida’s three-pronged strategy includes executing new reinsurance contracts, pursuing opportunistic acquisitions of insurance companies and issuing new annuity and life insurance products. Ares currently manages over $16 billion of assets in various investment strategies for more than 100 insurance company clients. Ares and the AIS platform are leveraging this experience to provide asset oversight and management as well as access to infrastructure and capital to drive Aspida’s growth objectives.
Aspida Re will be well positioned for future growth in providing customized solutions to help annuity and life carriers optimize their capital needs, improve financial results and manage the growth of their businesses. In addition to asset management oversight, Ares and AIS also expect to provide Aspida Re with capital optimization and strategic M&A origination and advisory services. Concurrent with the closing of the transaction, Aspida Re will retain members of the Company’s management team and enter into a strategic flow reinsurance agreement to support F&G on certain annuity products. This agreement is expected to be an opportunity to further propel growth for both Aspida Re and F&G.
"We are excited to announce this acquisition, which marks an important next step in executing upon Aspida’s overall growth plans," said Michael Arougheti, Chief Executive Officer and President of Ares. "We remain committed to leveraging the expansive capabilities across the Ares and AIS platforms to support Aspida’s strategic objectives. With our market leading credit platform, we believe we are ideally suited to enable Aspida to consolidate market share in this strong growth sector."
"We believe that Aspida Re is well positioned to become a leader in the reinsurance space with the acquisition of a sizeable reinsurance platform and a talented Bermuda-based team with deep reinsurance expertise. We are also excited about our strategic flow reinsurance agreement with F&G, which will support further growth of both of our businesses," said David Reilly, Partner and Head of Ares Insurance Solutions. "We are encouraged by the current market environment, which provides a compelling opportunity for Aspida Re to be a solutions provider to insurance partners that are looking to optimize their balance sheets and be best positioned for future growth."
The acquisition of the Company is expected to close during the fourth quarter of 2020, subject to regulatory approvals and other customary closing conditions. The transaction is expected to be financially accretive as Aspida executes on its multiyear growth plans. Terms were not disclosed, but the consideration will be all cash.
Lazard acted as exclusive financial advisor and DLA Piper LLP served as legal counsel to Ares and Aspida.
About Ares Management Corporation
Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager operating integrated businesses across Credit, Private Equity and Real Estate. Ares Management’s investment groups collaborate to deliver innovative investment solutions and consistent and attractive investment returns for fund investors throughout market cycles. Ares Management's global platform had approximately $165 billion of assets under management as of June 30, 2020 with approximately 1,400 employees operating across North America, Europe and Asia Pacific, pro forma for the acquisition of SSG Capital Holdings Limited which closed on July 1, 2020. For more information, please visit: www.aresmgmt.com.
Aspida Holdings Ltd. ("Aspida") is an indirect subsidiary of Ares Management Corporation, which was created to execute on Ares Insurance Solutions’ plans to issue insurance and reinsurance products for individuals and institutions seeking to fund their long-term financial needs. Aspida seeks to be a trusted partner focused on its customers’ financial security and success. For more information, please visit: www.aspida.com.
About Fidelity National Financial, Inc.
Fidelity National Financial, Inc. (NYSE: FNF) is a leading provider of title insurance and transaction services to the real estate and mortgage industries. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York - that collectively issue more title insurance policies than any other title company in the United States. More information about FNF can be found at fnf.com.
F&G is part of the FNF family of companies. F&G is committed to helping Americans turn their aspirations into reality. F&G is a leading provider of annuity and life insurance products and is headquartered in Des Moines, Iowa. For more information, please visit www.fglife.com.
About F&G Reinsurance Ltd
Based in Bermuda, F&G Reinsurance Ltd ("F&G Re") provides reinsurance solutions to life and annuity insurance companies on both active and run-off blocks of business. F&G Re is a subsidiary of FGL Holdings and an indirect, wholly owned subsidiary of Fidelity National Financial.
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In addition to factors previously disclosed in Ares’ filings with the Securities and Exchange Commission, including those discussed under the heading "Risk Factors" in its most recently filed reports on Form 10-K and Form 10-Q, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the possibility that regulatory and other approvals and conditions to the transaction are not received or satisfied on a timely basis or at all, or contain unanticipated terms or conditions; the possibility that modifications to the terms of the transaction may be required in order to obtain or satisfy such approvals or conditions; delays in closing the transaction; difficulties, delays or unanticipated costs in integrating the Company’s operations; purchase price adjustments; unexpected costs resulting from the transaction, delays or other disruptions associated with the acquisition or integration of personnel or operations; changes in economic conditions; and regulatory conditions.
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Jonathan Doorley / Alex Yankus