AM Best Comments on Credit Ratings of Athora Holding Ltd.’s Subs Following its Announced Acquisition of a Closed Life and Pension Portfolio

Rhea-AI Summary

AM Best has affirmed the Financial Strength Rating of A- (Excellent) and Long-Term Issuer Credit Ratings of 'a-' (Excellent) for Athora Holding Ltd.'s subsidiaries, Athora Life Re Ltd. and Athora Ireland plc, following Athora's announcement of a EUR 19 billion portfolio acquisition from AXA S.A. The acquisition, set to close in late 2023 pending regulatory approval, will add approximately EUR 19 billion of assets and 0.9 million policyholders. Athora's strategy focuses on acquiring European life insurance liabilities, aligning with their investment management capabilities.

Positive

• Acquisition of a EUR 19 billion portfolio enhances assets under administration, increasing from EUR 79 billion to approximately EUR 98 billion.
• Addition of 0.9 million new policyholders expands Athora's market presence.
• Strategic alignment with investment management capabilities supports growth in European life insurance liabilities.

Negative

• None.

LONDON--(BUSINESS WIRE)-- AM Best has commented that the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of Athora Holding Ltd.’s (Athora) subsidiaries, Athora Life Re Ltd. (Bermuda) and Athora Ireland plc (Ireland), remain unchanged following Athora’s recent announcement that it has agreed to acquire a EUR 19 billion closed life and pension portfolio, via a carve-out acquisition, from a German subsidiary of AXA S.A.

Athora entered into a definitive agreement to acquire the portfolio on 14 July 2022. The transaction is expected to close in late 2023, subject to regulatory approval. At year-end 2021, Athora had EUR 79 billion of assets under administration (AuA) and 2.3 million policyholders. The AXA transaction will add approximately EUR 19 billion of AuA and 0.9 million policyholders. Athora is also in the process of completing its acquisition of Amissima Vita S.p.A. (Italy) and a portfolio transfer to acquire Belgian life insurance liabilities from the NN Group N.V., which are expected to close during 2022, and contribute approximately EUR 10 billion of AuA. None of the liabilities acquired in these transactions will be held directly in either of Athora’s rated subsidiaries.

The transaction is in line with the group’s strategy to acquire European life insurance liabilities in which the associated investment assets can benefit from Athora’s investment management capabilities, and is not expected to have a material impact on the key solvency or leverage metrics of Athora or its rated subsidiaries. AM Best will closely monitor the execution of the transaction and its impact on the Athora group.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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William Keen-Tomlinson

Associate Director, Analytics

+44 20 7397 4395

will.keen-tomlinson@ambest.com

Catherine Thomas

Senior Director, Analytics

+44 20 7397 0281

catherine.thomas@ambest.com

Christopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com

Jeff Mango

Managing Director,

Strategy & Communications

+1 908 439 2200, ext. 5204

jeffrey.mango@ambest.com

Source: AM Best

FAQ

What is the significance of Athora's acquisition of a EUR 19 billion portfolio from AXA S.A.?

The acquisition enhances Athora's assets under administration and expands its customer base, aligning with the company's growth strategy in the European insurance market.

When is the Athora and AXA portfolio acquisition expected to close?

The transaction is anticipated to close in late 2023, subject to regulatory approval.

How will the acquisition impact Athora's financial strength ratings?

AM Best has indicated that it does not expect any material impact on Athora's solvency or leverage metrics following the acquisition.

What are the expected benefits of the AXA portfolio acquisition for Athora?

The acquisition is expected to increase Athora's assets and policyholder base, leveraging its investment management capabilities for enhanced performance.