Anbang Insurance Group to Buy Fidelity & Guaranty for $1.57 Billion

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Life insurance policy and cash

Anbang Insurance Group is set to buy Fidelity & Guaranty Life (NYSE:FGL) in a deal that is currently valued at $1.57 billion. The deal is currently valued at $26.80 per share, which is a 3% premium over Friday’s closing price of Fidelity.

A private company, Anbang is based in China and is not likely to face any antitrust issues along the way. It’s expected that regulatory issues will be experienced within the United States, but these should not cause concern for investors.

Fidelity stock prices fell on the news by 1%, down to $25.98 a share. The deal will allow the privately held company to become one of the largest insurers of fixed indexed annuity products in the country.

The sale has been approved by Fidelity and is expected to be finalized by Q2 2016.

Anbang has made a few acquisitions within the United States in the last year. The biggest acquisition was when the company bought the Waldorf Astoria Hotel in a deal valued at $1.95 billion.

There has been considerable consolidation within the insurance industry in 2015, and it’s expected that this consolidation will continue into 2016.

Both companies have yet to release any further information about the deal aside from a closing date expectancy of the second quarter of 2016.

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