Gerova Acquires Ruby Portfolio for $105 Million
Gerova Financial Group, Ltd., a diversified Bermuda-based financial services company, announced today (Jan.5) that it has completed the acquisition of a portfolio of life insurance policies and loans on life insurance policies representing approximately $1.2 billion of in-force life insurance. The portfolio consists of 180 policies issued by highly rated insurance carriers with 96 percent of the carriers in the Portfolio rated A, A+, or A++.
The portfolio was acquired from HM Ruby Fund L.P., a Los Angeles-based hedge fund, for $105 million, consisting of $11 million in cash and $94 million in Gerova ordinary shares. The share consideration of $28.69 per share was based on the average closing price of Gerova on the New York Stock Exchange for the ten trading days ending December 30, 2010. The 3,276,403 shares to be issued in the transaction represent 10.2 percent of the issued and outstanding shares after giving effect to the issuance.
Concurrently, Gerova arranged a five-year $50 million line of credit. The proceeds will be used to service the portfolio, and to service future share-based portfolio acquisitions in the life settlements sector.
“This transaction reaffirms a key aspect of our business model, using our publicly listed shares to acquire private equity portfolios on favorable terms, ” said Keith Harris, incoming Gerova chairman.
Operating out of Cumberland House on Victoria Street, Gerova is an international reinsurance company, with operating insurance subsidiaries in Bermuda, Barbados, and Ireland.
On December 7, 2010 Gerova announced two other all-share transactions, agreeing to acquire institutional investment banks Seymour Pierce Holdings Ltd. and Ticonderoga Securities LLC.
“Today, Gerova acquired over a billion dollars of high quality financial instruments issued by investment grade rated institutions in exchange for Gerova equity, which substantially enhances our company´s balance sheet and our earnings potential as we plan for the integration of Seymour Pierce and Ticonderoga, ” continued Harris.
Wholly-owned subsidiary Gerova Advisors LLC arranged the transaction.
Why haven’t you reported on their deal with Argus to buy Northstar? This transaction has been outstanding for over a year and still not reported by Argus as completed. What is value of Northstar today (in Argus balance sheet 2010 March at $50,000,000. Details of the pending transaction have been disclosed by Gerova but not Argus.
Why don’t you check out Gerova head office in Hamilton. Its virtually a ghost town! Head office? I don’t think so!