Please see the below letter from Paula Nelson, President, Retirement, and Dave Wilken, President, Life, in which they share their insights and thoughts on the acquisition of Global Atlantic by KKR.
July 15, 2020
This is a very exciting time for Global Atlantic as we look toward the next phase of our growth and leadership in the industry. As you likely are aware, Global Atlantic and KKR announced on July 8 that KKR would acquire Global Atlantic Financial Group Limited, our parent company. We hope you had a chance to read the letter from Global Atlantic President Rob Arena. We’ve also created a resource page for you to learn more. However, we’d like to give you some additional perspective on the transaction and why you can continue to count on us for all of the reasons you do today – and more.
First, under KKR ownership, Global Atlantic will continue to operate as a stand-alone company under the Global Atlantic brand, with the same leadership, people, and products as today. Our passion and commitment to being a leading US retirement and life insurance company is unchanged, and fully aligned with KKR objectives. This is a transaction about partnership more than ownership.
The change in ownership structure is just that. It doesn’t change our commitment to you and the businesses we are in. This deal enhances our capabilities by providing a long-term capital structure and complementary investment management expertise that supports our continued growth and expands our ability to explore new markets and product opportunities. We believe you – our distribution partners, as well as our policy owners – will be beneficiaries of our enhanced access to incremental investment abilities, markets and relationships to further improve and expand our businesses.
As Joseph Bae and Scott Nuttall, Co-Presidents and Co-Chief Operating Officers of KKR, state in the press release, “Insurance providers play a critical role in supporting the financial security for millions of individuals. This transaction positions KKR to support Global Atlantic policyholders through our global network and asset management and origination capabilities.”
We believe this transaction is a vote of confidence and public validation of the trust that our customers and distribution partners have placed in us. KKR, a world-class investment firm with over $200 billion in assets under management and a current market capitalization of roughly $29 billion, is acquiring us directly. KKR will not hold Global Atlantic within a private equity fund. As stated in the Financial Times, “While Apollo and Blackstone have arm’s length relationships with insurers, the house of Kravis and Roberts will make its biggest ever balance sheet bet by owning Global Atlantic outright.”
In addition, all of our ratings – AM Best, Moody’s, Fitch and S&P – have been affirmed. Moody’s went a step further and raised our outlook to Positive from Stable. The positive outlook reflects Moody’s view that the “transaction with KKR will provide Global Atlantic access to capital and improve the company’s business profile over the long term…[and] also reflects Global Atlantic’s consistent profitability and improvement in its market position achieved growing its distribution reach through both its retail and institutional channels.”
As we plan for a future that can realize these benefits, we look forward to doing it with you, our distribution partners. You have played a significant role in our success to this point, and we greatly appreciate it. Thank you. We look forward to an even brighter future together.
Sincerely,
Paula Nelson, President, Retirement
Dave Wilken, President, Life