Key Points
Abacus Global Management (NYSE: ABX) stock ended Monday in positive territory on news that it had secured tens of millions of dollars in new funding and on the apparently smooth transition of an outgoing company official.
Shares of the alternative asset management company focused on insurance policies closed that trading session more than 1% higher, eking out a win over the S&P 500 index, which rose by 0.7%.
75 million new reasons to like Abacus
Just before last week’s Friday trading holiday, Abacus divulged in a regulatory filing that it managed to upsize an existing syndicated credit facility, and at quite a substantial amount.
That debt instrument, facilitated by Glas USA, now totals $225 million after Abacus secured an additional $75 million in lender commitments. The extra funds don’t come with a catch or several; Abacus wrote that the terms of the arrangement remain the same.
Later in that regulatory document, Abacus added that a member of its board of directors, Sean McNealy, resigned his position, effective this past June 30.
That move is connected with his planned retirement and was not “a result of any disagreement with the Company, management or the Company’s board of directors on any matter relating to the Company’s operations, policies or practices.” He will remain with Abacus in an advisory role.
Counting on wise management
It’s a flashing green light whenever a business manages to upsize a major credit facility by 50%. Obviously, Abacus is managing its finances well, as even the most forgiving lenders would hesitate before signing on to such an increase.
Abacus is a unique company that buys individual life insurance policies and bundles them for investment. It’s had its ups and downs over the years, but its business model is intriguing — and quite lucrative when managed well.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
