Gerova Financial Group Ltd. has paid a total of about $105 million for a $1.2 billion portfolio of life insurance policies and loans on life policies.
Gerova (NYSE:GFC), Hamilton, Bermuda, bought the policies and related loans from hedge fund HM Ruby Fund L.P., Los Angeles, with a combination of $11 million in cash and shares valued at $94 million.
The portfolio consists of 180 policies issued by highly rated carriers and sold by insureds through life settlement transactions, according to Gerova. The company says it will issue 3.2 million shares in connection with the transaction, or the equivalent of about 10% of its total shares.
In related news, Gerova says it has arranged a 5-year, $50 million line of credit. The company will use the line of credit to service the newly acquired life settlement portfolio and other portfolios it acquires.
