Mortgage lender acquired by US insurer

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Foundation Home Loans (FHL), which specializes in home lending and mortgages, was acquired by Athene Holding, a Bermuda-based retirement firm providing annuity products in the United States.

The undisclosed deal was managed by Apollo Global Management, a private equity firm that formed Athene back in 2009 and announced a $ 11 billion (£ 8 billion) merger with Athene in March to boost fixed value shares.

Athena bought FHL from Fortress Investment Group, which acquired the lender in 2010 and currently manages approximately $ 53 billion (£ 39 billion) in New York City assets.

As of June 2021, FHL had a portfolio of £ 3 billion in mortgages, according to Athene.

The pension product provider said FHL will provide it with “attractive investment opportunities in high quality assets.”

FHL declined to comment on the deal, which still requires regulatory approval.

Athene Chairman and Chief Executive Officer Jim Belardi said the deal added “direct asset search capabilities” to its investment portfolio.

Hans Geberbauer, CEO of FHL, added that the financial capabilities of Athene and Apollo will “significantly improve” the lender’s position in the UK market and that it will continue to provide home mortgages.

Athene is not the first American firm to buy out the UK mortgage market recently. Two UK digital brokers were acquired by US-backed firms last week.

Better American digital mortgage broker intends to enter the UK market through the Trussle buyout, which, according to Financial Times sources is only worth $ 9 million (£ 6.5 million).

US-supported organization RVU bought Mojo Mortgages is another UK-based digital mortgage broker – thanks in large part to its technology and commitment to scale post-deal.

FHL’s new owner remains at around $ 50 (£ 36), despite its total assets growing 17% between 2018 and 2019 and a number of other acquisitions. But after the merger was announced, the price jumped to $ 62 (£ 45).

Athene CEO Belardi hopes the upcoming merger will create “financial strength” that will unlock greater value for its shareholders.

Apollo originally owned 35% of Athene, but will now buy back the remaining shares, relying on the Athena business for 30% of its proceeds. The merger should be completed in January 2022.

ruby.hinchliffe@ft.com



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