Brookfield Trumps Buyout Titans With $50 Billion Deal Spree

(Bloomberg) — Canadian asset management giant Brookfield has emerged as the world’s most acquisitive investment firm this year, as the titans of private equity increasingly stay on the sidelines.

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Brookfield has announced more than $50 billion of purchases since the beginning of January, according to data compiled by Bloomberg. That’s roughly triple the deal tallies of buyout firms like Apollo Global Management Inc., EQT AB and Silver Lake Management. KKR & Co. has unveiled just one major public-company takeover bid this year.

Toronto-based Brookfield offered $4.3 billion this week for American Equity Investment Life Holding Co., one of the last remaining independent US annuities providers. The deal, first reported by Bloomberg News, could boost its assets under management to $900 billion.

It’s also responsible for two of the three biggest takeovers announced by investment firms globally this year. Brookfield’s infrastructure arm agreed in April to buy Triton International Ltd., the world’s largest owner of intermodal shipping containers, for $13 billion including debt. Its energy transition fund was behind a $12 billion March deal for Australian utility Origin Energy Ltd.

“A lot of the easy-money, lever-the-target deals are no longer possible,” said Oliver Scharping, a portfolio manager at Bantleon. “Brookfield are more active because they are looking at rather conservative, value-based assets that are still available at decent prices.”

Brookfield’s ascendance comes as some private equity firms struggle to complete buyouts amid shaky financing markets and rich price demands from sellers. The same headwinds are leading many of the biggest alternative asset managers to spend more time raising new direct-lending funds as the world of private credit booms.

Liquidity is scarce, and that’s creating a more disciplined environment, according to Anuj Ranjan, president of Brookfield Asset Management’s private equity business.

“Gone are the days of an auction with 45 bids, two pre-empts and—I’d say—some aggressive dealmaking,” Ranjan said in a Bloomberg Television interview Wednesday. “We’re in a place now where it’s very rational, very reasonable, and groups like ours can benefit.”

Brookfield is responsible for one of the London market’s biggest take-privates this year, the £2.2 billion ($2.8 billion) acquisition of Middle Eastern payments processor Network International Holdings Plc. It’s also been plowing into digital infrastructure, spending nearly $10 billion to buy Dallas-based Compass Datacenters and European operator Data4.

Chief Executive Officer Bruce Flatt is building on a busy 2022, when Brookfield was involved in leveraged buyouts of television-ratings firm Nielsen Holdings Plc and software provider CDK Global Inc. He’s looking for more, saying in May that Brookfield is exploring a number of take-privates across every aspect of its business.

The investment firm also isn’t shying away from putting some of its assets on the block. It’s seeking more than £4 billion in a sale of UK holiday resort chain Center Parcs, according to people familiar with the matter. Brookfield is also exploring the sale of a stake in an iconic office tower in the heart of Dubai’s financial district, Bloomberg News reported this month.

Brookfield has been hunting for bigger deals after bringing in around $100 billion of fresh money across its various businesses over the past 12 months. It’s been actively raising money for property, infrastructure, private equity and credit strategies in a bid to boost boost its fee-bearing assets under management to $1 trillion.

Large investors are becoming more selective on which private equity funds they’ll back, and buyout firms can’t count just on cheap financing or revenue growth to deliver returns any more, according to Brookfield’s Ranjan.

“You have to generate those returns and create growth through operational improvements,” he said. “As an industry as a whole, we’re back to ‘roll up your sleeves’ private equity.”

–With assistance from Kwaku Gyasi and Dani Burger.

(Updates with fund manager quote in fifth paragraph.)