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Secondary offering for AHL
Posted on Friday, 17 March 2017 13:59
Some shareholders of Athene Holdings (AHL) have decided now is the time to cash in some of their investment, especially as the market value of the Bermuda life insurer has risen by more than a fifth since being admitted to trading in December.
Goldman Sachs has returned to handle the secondary offering after working with Barclays, Citigroup and Wells Fargo Securities as joint bookrunners on the fixed annuities provider’s initial public offering.
While a prospectus with a USD 100.00 million placeholder has already been submitted to the US securities regulator, it does not yet give the size or price, or even which investors intend to take cash off the table.
AHL began operating in 2009 when the financial crisis drove many companies to exit the retirement market and in so doing provided an opportunity for a well-capitalised entity to fill the void.
The retirement market-focused company is perhaps mainly known for its strategic relationship with Apollo Global Management, which currently controls, and is expected to continue owning following the offering, 45.0 per cent of the total voting power.
It has an expected annual investment margin of 2.0 per cent to 3.0 per cent over the 7.8 year weighted-average life of its deferred annuities, which make up a substantial portion of reserve liabilities.
Earlier this week AHL announced results for the 12-months to 31st December 2016 which showed net profit was up at USD 805.00 million from USD 562.00 million in FY 2015.
At year-end, the group had high risk-based capital ratios, more than USD 1.50 billion of excess equity capital and no financial leverage.
Its US insurer Athene Annuity & Life Assurance, formerly known as Liberty Life Insurance, had a risk based capital ratio of 478.0 per cent and its local reinsure, Athene Life Re, had a Bermuda Solvency Capital Requirement ratio of 228.0 per cent, at the end of 2016.
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