(Bloomberg) -- Chinh Chu, a longtime dealmaker at Blackstone Inc., struck a deal to create an insurance and asset management firm to capture opportunities in a new model made popular by Apollo Global Management Inc.

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Chu’s firm CC Capital agreed to invest $250 million in Westaim Corp., a publicly-traded company based in Canada, according to people familiar with the matter, who asked not to be identified because the information is private. The deal will combine Arena Investors, a credit investing unit that manages about $3.5 billion, and a new business named Ceres Life Insurance Co. that focuses on fixed-index annuities under the Westaim holding company.

The group expects to roughly triple Arena’s assets to at least $10 billion in the next three to five years as the insurance company expands, the people said. CC Capital is also courting additional capital to expand the venture, including from sovereign wealth funds and family offices. Arena plans to continue to seek third-party investments from insurers.

CC Capital is taking a 36% stake in Westaim for C$4.75 per share, compared with the closing price of C$4.02 on Tuesday, with a lockup period of two years, the people said. Chu’s firm is also acquiring Westaim warrants that could help expand its stake to beyond 40% over time.

Representatives for CC Capital, Westaim and Arena didn’t immediately respond to requests seeking comment. Westaim, which currently owns 51% of Arena, will fully own the asset manager run by Dan Zwirn. The Ceres business will be run by Deanna Mulligan, the former CEO of Guardian Life Insurance Co.

CC Capital is entering one of the fastest-growing spaces in the world of alternative asset management. Fund managers including Apollo have increasingly delved into insurance for longer-term capital to invest in assets such as private credit, rather than raising third-party funds for such allocations. Funds don’t always choose to own insurance companies outright. Often, they strike partnerships to manage funds for insurers or take partial stakes in businesses, a strategy undertaken by Blackstone.

Apollo founded its own insurer, Athene, in 2009 and more than a decade later fully acquired the company, which is now the private investment firm’s biggest profit driver. Athene has also morphed into the largest seller of individual annuities in the US. Last year, its rival KKR & Co. agreed to buy the remaining stake of insurer Global Atlantic that it didn’t already own, making the insurance business an even bigger part of its strategy.