(Reuters) - Insurer Presidential Life Corp PLFE.O said it agreed to be bought by a unit of Apollo-backed (APO.N) Athene Holding Ltd for about $415 million in cash, a deal that will boost Athene's retail sales and reinsurance operations.
Athene was formed in 2008 by James Belardi, former chief investment officer of AIG (AIG.N) Retirement Services, and Chip Gillis, the former head of Bear Stearns' Insurance Solutions.
Bermuda-based Athene will pay $14 for each Presidential Life share, a 38 percent premium to the stock's Thursday close. Presidential's shares have not traded at the offer-price level in more than four years.
The company said the merger was not subject to financing conditions.
"The purchase of Presidential Life will create significant opportunities for growth," Athene CEO Belardi said in a statement.
Athene has been expanding through acquisitions. It bought Liberty Life, which was later renamed Athene Annuity, from Royal Bank of Canada RBC.TO in 2011 and Investors Insurance Corp from reinsurer SCOR SE (SCOR.PA) in the same year.
Presidential Life is based in New York. Athene Annuity does not currently operate in the state.
Presidential Life, which sells a variety of fixed annuity, life insurance and accident and health insurance, said its board unanimously approved the transaction, which is slated to close late 2012.
"(The) announcement is the result of a comprehensive process in which the board, with the assistance of its outside advisers, carefully considered strategic alternatives for our shareholders," Presidential Life Chairman John McMahon said in a statement.
Sandler O'Neill + Partners acted as the financial adviser to Presidential Life.
Nyack, New York-based Presidential's shares, which have fallen 11 percent in the last year, were up 37 percent at $13.90, making them one of the biggest percentage gainers on the Nasdaq.
Reporting by Jochelle Mendonca in Bangalore; Editing by Supriya Kurane