JAB Holding, the German investment group behind Krispy Kreme, Pret A Manger and Coty, has completed its first US life insurance acquisition, purchasing Prosperity Life from hedge fund Elliott Management, as part of its expansion into financial services.
The transaction values Virginia-based Prosperity Life, which oversees $25 billion in assets, at more than $3 billion, the Financial Times reported, citing sources familiar with the matter. The deal places JAB in competition with major Wall Street firms such as Apollo Global, KKR and Brookfield in the evolving life insurance sector.
JAB, known for investments in consumer brands, is diversifying under chief investment officer Anant Bhalla, who joined in May last year. Bhalla previously led the transformation of American Equity Investment Life, an Iowa-based insurer, into an active player in private markets before its $4.3 billion acquisition by Brookfield.
Last year, JAB adjusted its leadership and strategy following mixed results from a series of acquisitions totaling $50 billion during a period of low interest rates. Bhalla was then appointed to lead the company’s expansion into insurance, adding to its existing investments in pet insurance, according to the report.
Originally a chemicals business with stakes in Reckitt Benckiser and Coty, JAB became active in global dealmaking in 2012 after forming a holding company led by former Mars executive Olivier Goudet.
Over the next decade, it invested billions in various sectors, including coffee, quick-service restaurants, fragrances and veterinary services, prioritising industries with stable demand. However, after reassessing the returns on those acquisitions, the company shifted its focus to insurance.
JAB joins other alternative asset managers in identifying insurance as a key area for long-term investment. Life insurance companies have become sought-after targets on Wall Street, as firms seek to access their capital reserves, the Financial Times reported.
Elliott Management, which manages around $70 billion and is primarily known for its activist hedge fund, acquired Prosperity Life in 2019 through its private equity division.
