The Carlyle Group Inc. announced that it has signed a new advisory deal with Fortitude Re. The deal will boost the private equity firm’s total assets under management by approximately $150 million. Under the agreement, the private equity firm will earn recurring fees based on the profitability of Fortitude’s investment portfolio. The deal will also allow Fortitude to focus on identifying new growth opportunities and pursuing acquisitions.
Under the agreement, Carlyle will provide capital management and M&A services to Fortitude Re. The company will also source new growth opportunities for Fortitude Re. Fortitude will pay Carlyle a recurring fee based on the general account assets of Fortitude Re, which will adjust according to Fortitude’s profitability. The investors in the deal will have a minority stake in the newly formed advisory firm.
The deal will also allow Fortitude Re to leverage Fortitude’s existing investments in its portfolio. The new partnership will help the insurance company increase its overall assets under management by $50 billion and double its fee-related earnings. Ultimately, the deal is expected to more than double Fortitude’s total assets under management and revenue by 2025. Moreover, the deal will also allow Fortitude to expand its business internationally.
In the new deal, the two firms will collaborate to grow Fortitude Re’s credit asset base to $80 billion by 2024. The new relationship will also enable the two companies to maximize their financial success. The deal also aims to enhance the size of Fortitude Re’s global credit portfolio and to double its fee-related revenue. In addition, the partnership will help Fortitude refocus its efforts on innovation and growth.
Under the agreement, Carlyle will work with Fortitude to provide capital and M&A services to the insurance company. The adviser will also be responsible for sourcing new growth opportunities for Fortitude Re. The deal will be based on Fortitude’s profitability. Additionally, the investor will become a minority shareholder in the advisory firm. Once completed, the two companies will aim to double their fee-related revenue by 2025.
The deal is based on the financial performance of Fortitude Re. The investment will be based on Fortitude’s ability to maintain profitability. The deal will also double the company’s balance sheet. Fortitude will have about $30 billion in fee-earning assets at the time of the closing. The acquisition will boost the firm’s annualized FRE by $50 million. By 2025, the deal will double the size of Fortitude Re’s balance sheet.
In a new partnering, the investment firm will earn recurring fees from the assets managed by Fortitude Re. In return, Fortitude Re will pay the Carlyle Group an annual fee based on the general account assets that it manages. The agreement will generate up to $150 million in fee-related revenues. If the partnership is successful, it will boost the mutuality between the two firms and for Fortitude Re.