Abacus Global Management has completed a dual-tranche securitization valued at more than $400 million, marking the company’s largest securitization to date.
The transaction is collateralized by a diversified portfolio of life insurance policies and includes Class A and Class B notes along with a residual interest.
The notes received an investment-grade rating from a third-party rating agency.
Abacus said the offering was oversubscribed and subsequently upsized in response to institutional investor demand.
The company plans to use net proceeds to support continued policy origination and for general corporate purposes.
The transaction also supports Abacus’ broader effort to expand its asset management business and increase the proportion of revenue generated through recurring, fee-related earnings.
A special-purpose vehicle issued investment-grade notes backed by the pool of life insurance policies. Abacus will continue servicing the policies through its affiliates.
The structure allows Abacus to move longevity-based assets from its balance sheet into institutional capital markets while expanding assets under management and creating additional management fee opportunities.
Abacus operates an integrated platform spanning policy origination, underwriting and servicing, giving it the infrastructure to source longevity assets and connect them with institutional investors.
KEY QUOTES:
“This is a platform strategy, not a financing strategy. By packaging longevity-based assets into formats that institutional fixed income investors can own, we broaden and diversify our investor base, deepen the distribution channels available to our Asset Group, and build a durable, management fee driven revenue base, all while continuing to turn our balance sheet multiple times per year.”
Elena Plesco, Chief Investment Officer of Abacus Global Management
“This is the largest securitization to date for Abacus. The investment-grade rating and the demand we saw from institutional investors confirm something we’ve believed for a long time. There’s a deep market for longevity-based assets among the largest fixed income buyers in the world. That validation matters as much as the deal itself, and it tells us the path we’re on is the right one. I also want to thank the entire Abacus team for the work that made this closing possible.”
Jay Jackson, Chairman and Chief Executive Officer of Abacus Global Management
