Purchase of major West Des Moines insurance firm American Equity Life set to be finalized

The purchase of West Des Moines-based American Equity Investment Life Holding Co. by Brookfield Reinsurance will close Thursday, the companies announced in a news release Tuesday.

Valued at $4.3 billion, the deal signals another shakeup in the metro's life insurance and annuity sector, which has attracted investments from private equity giants over the last 15 years. Brookfield Reinsurance is a division of Canadian investment firm Brookfield Asset Management, which reports $900 billion in assets and holds commercial real estate, infrastructure, renewable energy and private credit businesses.

As of December, American Equity employed 1,000 workers.

The two companies first announced the deal last July, though they couldn't finalize Brookfield's purchase until New York and Iowa regulators signed off on the agreement.

More: While growth flattens for most Des Moines metro financial firms, private equity booming

More: Once its economic engine, Des Moines' financial industry shedding jobs, led by Wells Fargo

As other private equity firms have invested in annuity businesses, American Equity had become a hot acquisition target. The company had an 8% share of the country's indexed annuity market in 2023, according to the Des Moines-based Wink's Sales & Market Report, and was the fourth-largest firm in that space.

Athene Holding, another West Des Moines company, offered to buy American Equity in 2020 for $3 billion in a joint offer with Massachusetts Mutual Life Insurance Co. American Equity's board rejected the deal.

Around the same time, company leaders agreed to sell a 20% stake in American Equity to Brookfield. As part of the agreement, American Equity also agreed to buy reinsurance for some of its business from Brookfield, which was beginning to invest in the industry.

The agreement soured in the fall of 2022, when Brookfield announced it was pulling its representative off American Equity's board. The move came after American Equity reached a separate reinsurance agreement with 26North, a new private equity firm launched by former Apollo Global Management founder Josh Norris.

The hostilities ended last summer as American Equity's board agreed to sell the company to Brookfield.

Brookfield's entrance into the Des Moines metro follows other major private equity investments, which have spurred hiring in the financial sector as other local companies have stagnated over the last decade. Apollo helped launch Athene in 2009, expanding the company into the country's largest annuity provider.

The investment management company Blackstone reached an agreement with Des Moines-based F&G in 2017, in which Blackstone manages the insurance firm's assets. F&G has grown in recent years, moving to a new office at 801 Grand.

David Noble, a Valley High School and Drake University alumnus, founded American Equity in 1995. Noble had previously served as the CEO of annuities and life insurance company the Stateman Group, which financial services firm Conseco Capital Partners II purchased in 1994 for $350 million.

At the time of that deal, the Statesman Group paid Noble $1.9 million a year, making him the third highest-paid executive in the metro, according to the Des Moines Register's annual survey of management compensation.

Who is on American Equity's board?

Brookfield's acquisition of American Equity will provide significant paydays for some members of the local company's board, including:

• Gerry Neugent, co-chair of Knapp Properties.

• Joyce Chapman, former executive vice president of West Bancorp.

• Robert Howe, former chief examiner of the Iowa Insurance Division.

• Brenda Cushing, former chief financial officer of Athene.

• Dave Mulcahy, a local accountant and investor.

Tyler Jett is an investigative reporter for the Des Moines Register. Reach him at tjett@registermedia.com, 515-284-8215, or on Twitter at @LetsJett. He also accepts encrypted messages at tjett@proton.me.

This article originally appeared on Des Moines Register: Brookfield closing deal for West Des Moines' American Equity Life