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Oaktree, the distressed debt specialist owned by Brookfield, plans to acquire a controlling stake in Atlantic Coast Life Insurance Company from Advantage Capital (A-Cap), the Financial Times (FT) reported.
Funds managed by Oaktree will take control of the South Carolina, US-based insurer, which had around 6,000 in-force life insurance policies as of 2024 and more than $1.5bn in total liabilities including annuities.
This follows regulatory pressure on A-Cap linked to its lending ties with the collapsed Miami investment firm 777 Partners.
The downfall of 777 intensified when co-founder Josh Wander pursued a failed bid for UK Premier League football club Everton, having earlier acquired teams like Genoa and Vasco da Gama.
In October, New York federal prosecutors charged Wander with defrauding lenders and investors of $500m.
A-Cap’s 777 ties raised concerns among state insurance regulators, prompting efforts by the company to maintain underwriting capacity as well as a lawsuit against AM Best over a threatened rating downgrade that was eventually settled.
According to the report, A-Cap will retain the Utah-based insurer Sentinel, in which Oaktree also plans to invest.
Atlantic Coast Life is the latest target in Oaktree’s insurance push.
“Our planned acquisition of Atlantic Coast Life is the latest in a series of insurance investments where we partner with companies during a period of market dislocation or transition,” Oaktree senior vice-president in global opportunities Patrick George was quoted as saying by the FT.
In December, Oaktree backed new life insurer Avocet Partners through its managed funds and formed a special vehicle to reinsure commercial policies from Allianz.
As per the FT, the latest transaction fits a broader private equity trend, with firms such as Apollo, KKR and Brookfield expanding into US annuities and life insurance.
“Oaktree plans to take stake in Atlantic Coast Life Insurance – report” was originally created and published by Life Insurance International, a GlobalData owned brand.
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