JAB Holding, the German investment group and owner of brands like Krispy Kreme and Pret A Manger, has finalized its first US life insurance acquisition. The company purchased Prosperity Life from hedge fund Elliott Management as part of its expansion into the financial services sector.
The Financial Times reported that the deal values Virginia-based Prosperity Life, which manages $25 billion in assets, at over $3 billion. This acquisition places JAB in direct competition with prominent Wall Street firms such as Apollo Global, KKR, and Brookfield in the burgeoning life insurance market.
JAB, traditionally recognized for its investments in consumer brands, is diversifying its portfolio under the direction of Chief Investment Officer Anant Bhalla, who joined last May. 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.
Following mixed results from a series of acquisitions totaling $50 billion during a period of low-interest rates, JAB restructured its leadership and strategy last year. Bhalla was then appointed to spearhead the company’s expansion into insurance, complementing its existing investments in pet insurance, according to the report.
Initially a chemicals business with stakes in Reckitt Benckiser and Coty, JAB became significantly active in global dealmaking in 2012. This followed the establishment of a holding company led by former Mars executive Olivier Goudet. Over the subsequent decade, the firm invested billions in various sectors, including coffee, quick-service restaurants, fragrances, and veterinary services, primarily targeting industries with consistent demand. However, after reevaluating the returns from these acquisitions, the company shifted its focus to insurance.
JAB joins a growing number of alternative asset managers identifying insurance as a key area for long-term investment. The Financial Times noted that life insurance companies have become highly sought-after targets on Wall Street as firms aim to access their capital reserves.
Elliott Management, managing approximately $70 billion and known for its activist hedge fund, acquired Prosperity Life in 2019 through its private equity division.
