MassMutual has made a big bet on the annuities market with a $3.5 billion deal to acquire Great American Life Insurance Co. from its parent, American Financial Group.
Under the terms of the deal, Great American Life and its 600-plus employees will join MassMutual as an independent subsidiary and will remain headquartered in Cincinnati after the deal closes, likely in the second quarter of 2021. The business will continue to be led by president Mark Muething. MassMutual employs about 6,000 people, making the Springfield-based insurer roughly 10 times the size of Great American Life.
Great American Life specializes in fixed and indexed annuities. MassMutual executives view the annuity market as having vast potential for growth as more baby boomers approach retirement. The deal also brings Great American Life’s distribution network, particularly with banks, that will help MassMutual reach an even bigger customer base.
“This acquisition is an excellent strategic fit for MassMutual that will broaden our product offerings, expand our distribution, and generate additional earnings, allowing us to build a true lifetime income franchise and deliver ongoing value to our policyowners and customers,” said Roger Crandall, MassMutual’s chief executive, in a statement.