F&G Annuity and Life (FG) is a small-to-medium life insurer with a market cap of $4.6B. Fidelity National (FNF) owns 82% of its shares.
The opportunity in FG exists because FNF can spin off all the shares it owns to FNF's existing shareholders tax-free at any time (I explained the details in my previous publications, with the latest here). After that, FG will become the only standalone, smaller US fixed annuity provider and a likely acquisition target.
Over the last several years, all similar companies have been snapped up by either alternative asset managers (Apollo, Brookfield, KKR) or larger insurers. Examples include Athene, Global Atlantic, American National, American Equity Life, and others. The prices have been equal or close to BVPS (Book Value per Share) ex-AOCI (Accumulated Other Comprehensive Income), depending on the “purity” of the fixed annuity provider (i.e., the percentage of fixed annuities vs. other products) and operating results.
On both counts, FG earns high marks. The company sells almost exclusively fixed annuities and, until very recently, maintained an unbroken streak of quarterly successes. This implies that in the acquisition, the FG share price is expected to be close to $43.39, which is the BVPS ex-AOCI as of June 30, 2025. Since FG currently trades at $34, this translates to a maximum upside of 28% plus an annual dividend yield of 2.6%.
The opportunity has existed since the end of March 2025, when the FG price dropped from $42-43 to the mid-thirties. In this post, I will incorporate the latest data into my analysis.