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☆ Big insurance companies want more private credit. Here's how Blackstone is using AI to win them over.
▼ + stars: | 2024-02-08 | by ( Bianca Chan | ) www.businessinsider.com time to read: +6 min

Insurance companies represent a big opportunity for private equity firms, who invest with the accumulated premiums paid by millions of everyday Americans. It's not just insurance clients that benefit from AI to bring more transparency to the cloudy private credit market. With private credit, insurance firms can invest in a more diversified set of assets with greater yield (and, albeit risk) than public credit markets, like vanilla corporate bonds. And because insurance companies often have long-term horizons with their financial obligations to policyholders, they can invest in less-liquid asset classes, like private credit. But to win more insurance clients, Blackstone must compete with the likes of Apollo Global Management, Carlyle, and KKR, which have also been keen on insurance.

Persons: Blackstone, John Stecher, it's, Stecher, Gilles Dellaert, Carlyle, that's, Jon Gray, Gray Organizations: Blackstone, —, Business, Insurance, Blackstone Insurance, Apollo Global Management, KKR Locations: BXCI

☆ Private-asset binge exposes insurance to new risks
▼ + stars: | 2023-11-30 | by ( John Foley | ) www.reuters.com time to read: +7 min

The concept is not new: Warren Buffett’s Berkshire Hathaway (BRKa.N) has used its insurance premiums to help fund everything from railways to cowboy-boot makers. The prospect of insurance companies buying risky loans or private equity investments has raised eyebrows. Many private credit assets, for example, rely on so-called private letter ratings based on confidential data. Given the private nature of private credit, it’s hard to see from the outside how big these risks are, or where they lurk. Besides, even if the share of life insurance assets that are mis-rated or undercapitalized is tiny, smaller insurers could carry more concentrated risk.

Persons: Blackstone, Warren Buffett’s Berkshire Hathaway, Fitch, Kroll, Egan, Jones, DBRS Morningstar, Banks, SVB, Jonathan Guilford, Neil Unmack, Peter Thal Larsen, Oliver Taslic Organizations: Reuters, Apollo Global Management, KKR, Global Atlantic, Investments, National Association of Insurance, England’s Everton FC, Rivals, Reuters Graphics Reuters, Federal Reserve, Federal Deposit Insurance Corp, Athene, P Global, Insurance, SVB, Thomson Locations: Global, Delaware , New York, Iowa, New York, London

☆ Apollo’s divergent path outshines Blackstone
▼ + stars: | 2023-09-28 | by ( Jonathan Guilford | ) www.reuters.com time to read: +7 min

NEW YORK, Sept 28 (Reuters Breakingviews) - Apollo Global Management (APO.N) and Blackstone (BX.N) both emerged from private equity’s primordial swamp. That spread comprised nearly three-quarters of Apollo’s $3.1 billion in profit available to be doled out to shareholders in 2022. That turbo-charged the fees Blackstone reaps from managing funds, which contributed 59% of $6.6 billion in profit available to shareholders last year. Apollo’s earnings from its insurance business are awarded an even more meager 10 times. This doesn’t form the closed loop like that between Athene, Apollo and its various specialist lenders.

Persons: Marc Rowan, haven’t, dealmaking, Rowan, Blackstone, Steve Schwarzman, Athene, BREIT, Rich, reckons Bain, Schwarzman, Dealmaking, hasn’t, Lauren Silva Laughlin, Oliver Taslic Organizations: Reuters, Apollo Global Management, Blackstone, Apollo, Reuters Graphics Reuters, Barclays, Schwarzman, U.S . Federal, Industry, Life Insurance, Research Association, Thomson Locations: freefall, BREIT, Blackstone

☆ S&P 500 investors are betting on a handful of stocks like Tesla and Nvidia, Apollo's Marc Rowan warns
▼ + stars: | 2023-08-24 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

The S&P 500 is dominated by a handful of Big Tech companies like Apple and Amazon. Investors in the index are speculating on just a few companies, Apollo's Marc Rowan says. The S&P 500 weights its constituents by market capitalization, meaning companies with trillion-dollar market caps like Apple, Amazon, Alphabet, and Microsoft have outsized influence among the roughly 500 stocks in the benchmark index. Moreover, Apollo outbid Berkshire for Tech Data in 2019, underscoring that Rowan and Buffett have similar tastes in businesses. Buffett hasn't voiced the same concerns as Rowan about the intense concentration of Big Tech in the S&P 500.

Persons: Apollo's Marc Rowan, Rowan, it's, Warren Buffett, Marc Rowan, Buffett, Buffett hasn't Organizations: Big Tech, Apple, Investors, Service, Nvidia, Australian Financial, Apollo Global, Microsoft, Apollo, Athene, Tech Data, Berkshire Locations: Wall, Silicon, Berkshire

☆ Brookfield to buy annuities provider American Equity in $4.3 bln deal
▼ + stars: | 2023-07-05 | by ( Manya Saini | Thomson Reuters | Manya Saini Reports On Prominent Publicly Listed U.S. Financial Firms Including Wall Street S Biggest Banks | ) www.reuters.com time to read: +2 min

July 5 (Reuters) - Canadian investment firm Brookfield (BN.TO) on Wednesday agreed to buy the remaining stake in American Equity Investment Life Holding (AEL.N) that it did not already own, valuing the long-sought-after annuities provider at $4.3 billion. It represents a 35% premium to AEL's last closing price on the New York Stock Exchange before media reports of a possible takeover bid from Brookfield emerged. The deal consists of $38.85 in cash and the rest in shares of Brookfield Asset Management's (BAM.TO). AEL shares had touched a record-high of $53.68 when the bid was announced on June 27 and have been trading around the same levels. If the deal is terminated, AEL has agreed to pay Brookfield Reinsurance a termination fee of $102 million.

Persons: Jon Bayer, Manya Saini, Nivedita Bhattacharjee, Arun Koyyur Organizations: Equity Investment Life, AEL, Elliott Investment Management, Prosperity, Brookfield, New York Stock Exchange, Brookfield Asset, FIA, Athene, Massachusetts Mutual Life Insurance, Thomson Locations: Brookfield, Athene Holding, Bengaluru

Like its peers, private equity firm Apollo was hit by a slump in dealmaking in the quarter that made it challenging to cash out of its private equity holdings for top dollar. Its asset management and retirement businesses, however, helped it cushion the blow. Apollo said its adjusted net income fell to $845 million from $917 million a year earlier. That resulted in adjusted net income per share of $1.42, lower than the average analyst forecast of $1.47, according to Refinitiv data. By contrast, private equity funds of Blackstone, Carlyle and KKR appreciated by 2.8%, 1%, and 2%, respectively.

☆ Apollo assures investors deposit flight won't spill over to Athene
▼ + stars: | 2023-03-30 | by ( Chibuike Oguh | ) www.reuters.com time to read: +5 min

Reuters GraphicsIn a quarterly update to shareholders published on March 13, Apollo outlined how Athene's funding model is different than a bank's. In the wake of the banking crisis, however, Apollo has been fielding questions from analysts and investors about Athene's funding model. Following a meeting with Apollo executives, Hone wrote in a note last week that he does not anticipate a spike in withdrawals from Athene's annuity holders and that Athene's funding base was stable. Apollo said in its March 13 presentation to investors that it had seen inflows of $8.8 billion to Athene from the start of the year to March 10. Questions from investors and analysts to Apollo have focused on this subset of annuity policies that have a potentially higher flight risk.

☆ Private-equity salaries revealed: Here's how much top firms like Blackstone, KKR, and Oaktree are offering 2024 associates
▼ + stars: | 2023-02-09 | by ( Emmalyse Brownstein | Rachel Durose | ) www.businessinsider.com time to read: +8 min

Some of the most recent private equity recruits will rake in nearly $200,000 in base pay alone. Among the firms recruiting are Bain Capital, Blackstone, and KKR & Co. — three of the largest private-equity firms in the world based on funds raised in the last five years. These private-equity firms, along with others, have increasingly accelerated their recruiting timelines to get ahead of competitors, as Insider previously reported. To woo promising junior talent, private-equity firms offer sky-high salaries and even more enticing bonus propositions, much like in investment banking, from which these firms cull most of their talent. Oaktree Capital ManagementOaktree Capital Management was founded in 1995, and has $170 billion in AUM, according to its website.

☆ A night with Wall Street's stars: Take a look at Insider's celebration of top investors, dealmakers, and traders
▼ + stars: | 2023-02-01 | by ( Michelle Abrego | ) www.businessinsider.com time to read: +4 min

Hello 10 Things on Wall Street readers! As you might know, for the last few years Insider has been highlighting some of the most talented young people on Wall Street. Take a look at all the photos from Insider's celebration of Wall Street's rising stars here. A decade after the private-equity giant helped launch Athene Holdings, more private money managers are moving into insurance as they hunt for higher yields, the Wall Street Journal reports. Adam Berry, head of US loan trading is leaving Wall Street to join the Philadelphia Eagles, according to Bloomberg.

☆ 2023 is shaping up to be a big year for dealmaking in live sports. Here's why.
▼ + stars: | 2022-12-09 | by ( Dan Defrancesco | ) www.businessinsider.com time to read: +6 min

Big deals for the big (and little) screen. Next year is shaping up to be a big one for media deals. Like many other industries, media quickly turned quiet on the dealmaking front this year as the economy soured. However, a stabilization of interest rates, along with money burning a hole in investors' pockets, could lead to a big 2023, insiders say. The landscape for media deals is fascinating when you consider the two opposing forces, as Lucia pointed out to me.

☆ From Apollo to DZ Bank, funds snap up bargains in UK pension scramble
▼ + stars: | 2022-11-18 | by ( Nell Mackenzie | ) www.reuters.com time to read: +4 min

REUTERS/Hannah McKay/File PhotoSummarySummary Companies Pension funds still need to raise cashCredit funds pick up bargains from pension fund salesSome credit funds already sitting on profitsLONDON, Nov 18 (Reuters) - Credit funds at Blackstone, Apollo, DZ Bank and Astra Asset Management picked up bargains from UK pension funds during their scramble for cash, and some say pension schemes are still offloading assets as pressures persist. Hedge funds and private equity firms have taken advantage of the forced sales to snap up deals - including certain portions of collateralised loan obligations (CLOs), securities that pension funds invest in. The credit funds are already sitting on juicy profits on some of these trades. This is because these pension funds must match their portfolios to what they will owe retired members. Even though the markets have calmed, some pension funds are still dealing with the implications," said Mody.

☆ With Interest Rates Rising, Companies Look to Unload Pension Liabilities
▼ + stars: | 2022-09-28 | by ( Jennifer Williams-Alvarez | ) www.wsj.com time to read: +6 min

Rising interest rates are boosting corporate pension plans, providing finance chiefs with an option to lighten their companies’ balance sheets and transfer obligations to insurers. PREVIEWWhen interest rates rise, liabilities for defined-benefit plans—a type of pension plan that promises fixed amounts to participants—shrink. They can also move just a portion of their pension obligations, but that still requires a high funding status. “If interest rates level off or decrease, the funded status could fall pretty quickly,” said Matt McDaniel, a partner at Mercer who advises companies on pension risk transfers. Recent stock market declines have hurt some defined-benefit pension plans invested in publicly traded equities, Mr. McDaniel said.

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