Canadian investment firm Brookfield Corp (NYSE:BN) is close to acquiring American Equity Investment (NYSE:AEL), according to a Bloomberg report, which cited sources familiar with the matter.
Following the report, shares of American Equity jumped at the end of the trading day and closed with more than a 10% gain. Currently, shares are up around 7% after-hours.
According to people familiar with the matter, Brookfield's reinsurance arm has made a cash and stock offer, which is expected to be recommended by the American Equity board. The deal could be announced as early as Monday.
Brookfield Reinsurance already holds a 20% stake in American Equity and is the biggest shareholder in the company.
This transaction comes after several years of takeover interest in American Equity from various potential buyers. In December, American Equity rejected an unsolicited offer from Prosperity Life Insurance Group, supported by Elliott Investment Management.
Brookfield's offer is higher than the previous proposal and values American Equity at a premium, as per the sources.