Centerbridge, MassMutual Forming Reinsurance Firm Martello Re
(Bloomberg) -- An investor group that includes Centerbridge Partners and Massachusetts Mutual Life Insurance Co. is planning to start a life and annuity reinsurance company, according to people familiar with the matter.
The new firm, Martello Re, will have an initial equity investment of $1.65 billion, said the people, who asked not to be identified because the information is private. Other backers of the new firm are expected to include Brown Brothers Harriman, the people said.
A spokesperson for Centerbridge declined to comment. Representatives for MassMutual and Brown Brothers didn’t immediately respond to requests for comment.
The move reflects a growing interest among alternative asset managers in the insurance business. Apollo Global Management Inc. helped launch Athene Holding Ltd. in 2009 and agreed last year to acquire the business outright in a deal implying an equity value of $11 billion for Athene. Carlyle Group Inc. and T&D Holdings Inc. agreed in 2019 to buy a majority stake in Fortitude Re from American International Group Inc. for about $1.8 billion.
Reinsurers take on risks from primary carriers. Martello Re will provide MassMutual reinsurance capacity on current product offerings and will subsequently look to offer services to third-party clients.
MassMutual will initially reinsure about $14 billion of general account liabilities to Martello Re and also enter into a flow arrangement to reinsure new business, the people said. Centerbridge and Barings will manage Martello’s investment portfolio jointly, looking at both private and public assets.
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