Carlisle Management Company

Life Insurance as an Investable Asset

Targeted High-Return and Uncorrelated Alternative Investment

* A detailed financial model with assumptions and scenario analysis functionality is available upon request. Target returns are presented solely for the purpose of providing insight into the Company’s objectives, detailing anticipated risk and reward characteristics, and establishing a benchmark for future evaluation of performance. Target returns are not a predictor, projection or guarantee of future performance. There can be no assurance that these targets will be met. There is no guarantee as to the Company’s future performance or the adequacy of the methodology used for estimating future returns. Target returns should not be used as a primary basis for an investor’s decision to invest. Target returns should not be used as a primary basis for an investor’s decision to invest.

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Industry

Financial Services

Company Type

Life Settlement

Size

$250 Million

Investment Type

Equity

For additional information, please contact:
Tamara Williams | Managing Director
(385) 600-1871
Donald Jordan | Managing Director
(248) 761-0862

Overview

Carlisle Management Company SCA (“Carlisle” or the “Company”) is a Luxembourg-based regulated alternative investment platform focused on the US life settlements market – purchasing secondary / tertiary life insurance policies as an investable asset


The Company has announced a definitive agreement to be acquired by Abacus Life (NASDAQ: ABL), a US publicly-traded alternative asset manager that is expected to result in the group becoming the largest origination company and asset manager in the life settlements industry


Carlisle is seeking $150-$250 million to grow the platform

* A detailed financial model with assumptions and scenario analysis functionality is available upon request. Target returns are presented solely for the purpose of providing insight into the Company’s objectives, detailing anticipated risk and reward characteristics, and establishing a benchmark for future evaluation of performance. Target returns are not a predictor, projection or guarantee of future performance. There can be no assurance that these targets will be met. There is no guarantee as to the Company’s future performance or the adequacy of the methodology used for estimating future returns. While a definitive agreement exists, there is no guarantee that the Company will be acquired by Abacus Life (NASDAQ: ABL). Target returns and the pending acquisition should not be used as a primary basis for an investor’s decision to invest. 

Company Track Record

Carlisle is the largest alternative asset manager focused solely on life settlements with a 15-year+ track record

  • Established in 2008
  • Supervised by the Luxembourg financial regulator CSSF
  • Management company and funds audited by KPMG

Active Policies as of Date

  • ~$2 billion AUM (~$4.3 billion face value)
  • 1,609

Policies Matured/Sold as of Date

  • ~$2.3 billion
  • 2,406

Historic Returns

  • 1.69 x MOIC
  • 13-15% Net IRR (Gross IRR 19-23%) Average Annualized Return

Target Gross Return at Entry

  • 22.0% (discount rate applied to the future cash flows that will determine the acquisition price of the policies)

Abacus/Carlisle – Combination Rationale

The combination is set to create the largest life settlements origination company and asset manager globally

Positioned at the forefront of the industry and product innovation – The combined entity will become the largest origination company and asset manager in the life settlements industry, leading the way for innovation


Global coverage spanning US, Europe, Middle-East and Asia – Have a global reach and a framework to service clients and investors across geographies, brining life settlement solutions and investments to the global investor market


Leverage new business opportunities – Incorporate new business solutions, products, and services to existing and new clients, as well as new innovative products that the company will be developing


Deliver state-of-the art services and support to investors – Enhance the existing services to investors and provide unparalleled support to Carlisle operations incorporating innovative offerings from ABL Tech

Abacus/Carlisle – Synergy Opportunity

Compelling synergy opportunity that should bolster outcomes for its investors

  • Global, leading institutional shareholders allow access to a broader pool of capital, resulting in increased financial flexibility and lower cost of capital
  • Combined investment management acumen
  • Improved contingency and succession planning strategy to ensure business model sustainability
  • Access to unprecedented origination sources and top-quality streamlined servicing across the entire value chain
  • Enhanced asset monetization opportunities
  • Cost optimization potential due to economies of scale

Key Investment Highlights

The combined entity’s long-standing and proven track record has established it as a respected leader in the highly-regulated US life settlements market

Vertically-integrated alternative asset manager, originator and market maker – The combined Abacus / Carlisle entity is expected to be the largest origination company and asset manager in the life settlements industry. The vertical integration allows the group to control the channel, to have a steady supply of assets, and to benefit from information asymmetry – key differentiators not available in the tertiary market


Large underpenetrated market opportunity and social benefits – Life insurance is a $13tn market, with $233bn of policies lapsing every year. Only $4bn of policies get settled before lapsing, due to low consumer awareness. Life settlement provides senior individuals access to the value of an otherwise illiquid asset


Attractive uncorrelated yields  – Target 15% net IRR* with highly predictable cash flows and low volatility of returns, effectively acting as a mortality-driven zero-coupon bond.  The primary investment risk of this asset is longevity, which is uncorrelated with the broader capital markets


Investment grade counterparty risk with significant downside protection – The underlying payment claims are born by mostly investment grade-rated insurance carriers. Policies are super senior obligations and are cash collateralized at the carrier level


Limited competition and high barriers to entry – Carlisle holds an Alternative Investment Fund Manager (“AIFM”) license in Luxembourg and is regulated by CSSF. Abacus is the largest originator (in terms of settlement value) with ~25% market share and is licensed and regulated by the department of insurance in each of the 49 states it operates. As a publicly-traded company, Abacus is also regulated by the SEC

* A detailed financial model with assumptions and scenario analysis functionality is available upon request. Target returns are presented solely for the purpose of providing insight into the Company’s objectives, detailing anticipated risk and reward characteristics, and establishing a benchmark for future evaluation of performance. Target returns are not a predictor, projection or guarantee of future performance. There can be no assurance that these targets will be met. There is no guarantee as to the Company’s future performance or the adequacy of the methodology used for estimating future returns. While a definitive agreement exists, there is no guarantee that the Company will be acquired by Abacus Life (NASDAQ: ABL). Target returns and the pending acquisition should not be used as a primary basis for an investor’s decision to invest. 

Life Settlements vs. Other Asset Classes

Life settlements – unlike other alternative assets – are largely immune to credit risk, interest rate risk, and broader market risk, while generating reliable ongoing cash flows

Management Team

Jose C. Garcia | CEO


  • 20 years in life settlements
  • Co-founded Carlisle Management Company
  • Successful track record across life settlements and capital markets, as well as fund management, and investment structuring
  • Led and overseen the purchase of over $15bn of face value of life settlements
  • Previously, CEO and Equity Partner of Portsmouth Financial Group

Tim Mol | COO


  • 14 years in life settlements
  • Co-founded Carlisle Management Company
  • Experience includes investment fund management and administration, including a number of life settlement vehicles
  • Previously, Director of Operations at Equity Trust Group

Ward H. Kerr | Lead Acquisition Consultant


  • 25 years in life settlements
  • Extensive relationships with executives, brokerage firms, insurance agencies, and regulators in the insurance, wealth  management and brokerage industries
  • Originated over $5bn of face value of life settlements
  • Previously, Co-founded Life Equity in 1999, as Chief Marketing Officer

Victor Heggelman | CFO


  • 13 years in life settlements
  • Joined Carlisle in 2009, appointed CFO in 2011
  • Experience includes audit and advisory services to numerous life settlement investment vehicles regarding accounting policies and valuation
  • Previously held roles at Morgan Stanley and KPMG

Christopher Winters | Head of Portfolio Management


  • 16 years in life settlements
  • Extensive experience in life settlements, working in a variety of capacities, including the development and launch of new investment vehicles, management of large portfolios, and the executive management of a life settlement operations
  • Previously, Chief Operating Officer of Portsmouth Financial Group

Specific Risks

  • Operational Risk: In the normal course of business, the investments may be exposed to a variety of operational risks, including position pricing and Net Asset Value calculation procedures, client reporting procedures, compliance controls, and policy acquisition sources
  • Liquidity Risk: The platform may not be able to settle or meet its obligations on time
  • Credit Risks: Insurance companies issuing the life insurance policies may be unable or unwilling to meet the death benefit payments of the insured lives as they fall due
  • Mortality Extension/Longevity Risk: Risk of insured living longer than expected – actual versus expected
  • Private securities are speculative, illiquid, and carry a high degree of risk – including the loss of the entire investment
Learn More About Carlisle Management

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Thanks, Ken

Ken Margolis | Managing Partner Castle Placement, LLC
1460 Broadway Street, Rte 400
New York, New York 10036
(212) 418-1188 | C: (516) 712-7784
kmargolis@castleplacement.com

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