How an insurer in Iowa became the most coveted asset on Wall Street
The man of the moment in private capital is not anywhere near New York City. Rather, Anant Bhalla is based in sleepy West Des Moines, Iowa, running a retirement annuities purveyor that is captivating Wall Street’s savviest financiers.
American Equity Investment Life last week rebuffed an unsolicited $4bn offer from a rival controlled by Paul Singer’s Elliott Management, capping a tumultuous year during which Bhalla also antagonised his company’s largest shareholder, Canada’s Brookfield Asset Management.
Underpinning the boardroom drama is Bhalla’s determination to keep AEL — one of the few independent annuities operators left — out of the wave of consolidation sweeping through the industry as private equity firms hoover up insurance assets.
In late November, AEL granted Bhalla 1.2mn new shares that vest at stock prices between $45 and $60, an aggregate award that could eventually be worth more than $70mn. Selling the company at $45 per share would mean missing out on the full windfall.
Bhalla managed to maintain AEL’s independence in 2020 but might find keeping it out of the clutches of a buyer more difficult this time. Brookfield has gone from a white knight to a thorn in his side. In a securities filing last week, Brookfield said it would soon exercise its right to reappoint a director to the board to help AEL evaluate what it described as the “highly credible” offer from Elliott.
This story originally appeared on: Financial Times - Author:Mark Vandevelde
