By David French and Pablo Mayo Cerqueiro
(Reuters) – Credit investment firm Bayview Asset Management told Reuters it has put its insurance arm Oceanview Holdings up for sale, in what could be the latest chapter of dealmaking in North America’s life insurance and annuities sector.
The sale process comes amid strong appetite from private equity firms and other asset managers for the fee revenue that comes from managing life insurance assets. There are now fewer opportunities to snap up such assets because high interest rates make it easier for insurers to generate enough returns without divesting them.
As a result, buyers are increasingly seeking to acquire the insurers themselves.
“Recently, several parties have made unsolicited indications of interest to purchase Oceanview at a significant premium to book value. Bayview has engaged an adviser to evaluate what potential transactions, if any, should be considered,” a Bayview spokesperson said.
The spokesperson declined to comment on the potential deal price, and did not name the adviser. People familiar with the matter said Oceanview has a book value around $1 billion, and so the offers at a premium would value it higher.
New York-based Bayview created Oceanview in 2018, funding it initially with $1 billion in equity capital.
Oceanview currently consists of a U.S. annuities provider with close to $8 billion in assets and a reinsurance company.
Dealmaking in this space has been robust. Life insurer National Western Life Group agreed in October to sell itself to Prosperity Life for $1.9 billion, while Brookfield Reinsurance said in July it would pay $4.3 billion to acquire annuities provider American Equity Life.
Reuters reported in August that Monument Re, a Bermuda-based consolidator of old life insurance portfolios, had appointed bankers to explore strategic options.
(Reporting by David French in New York and Pablo Mayo Cerqueiro in London; Editing by Marguerita Choy)