US-based private investment management firm Neuberger Berman has acquired insurance-linked strategies manager Cartesian Re and affiliated reinsurer Iris Re.
Cartesian Re is a specialist asset manager and along with its affiliate Iris Re, manages over $1bn in assets under management (AUM) focused on insurance-linked strategies (ILS) asset class.
Cartesian Re was developed as a portfolio company of Cartesian Capital Group and will strengthen Neuberger Berman with its ILS capabilities to its clients globally.
Cartesian Capital Group established Cartesian Re in 2009, as an ILS manager focused on industry-loss warranties, and has grown the firm consistently for nine years.
It is claimed that since inception, Cartesian Re has consistently sought investment returns that are uncorrelated with traditional asset classes, while offering better transparency and less counterparty risk to its investors, compared to other traditional insurance-related strategies.
Cartesian Capital Group managing partner Peter Yu said: “We are excited that Cartesian Re has now joined Neuberger Berman. I have long had the highest regard for Neuberger’s thoughtful investment philosophy and execution. We look forward to a long and productive collaboration.”
According to Neuberger Berman, Cartesian Re will add a diverse group of institutional clients and an experienced investment team, which has a long-term track record driven by a proprietary investment process and sophisticated quantitative analytics.
Neuberger stated that acquiring Cartesian Re illustrates its focus on diversifying its alternative capabilities, particularly with strategies offering returns uncorrelated with financial markets.
The company plans to rename Cartesian Re as NB Insurance-Linked Strategies and its affiliate Iris Re, will be renamed as NB Reinsurance.
Neuberger Berman alternatives head Tony Tutrone said: “The investment team from Cartesian Re brings to our clients an established track record from unique investments that are not correlated with traditional asset classes.
“Peter and his team started with a concept and have built a world-class organization and we look forward to working together.”
All of Cartesian Re professionals, including Managing Directors Peter DiFiore, Cedric Drui and Charles Mixon, have joined Neuberger Berman and will continue to serve in their present roles.
The two companies say that they have taken care in preserving Cartesian Re’s investment management, investment philosophy, strategy and operations.