Tiptree Financial is a diversified holding company that primarily acquires
and manages controlling interests of operating businesses. The Company, whose
operations date back to 2007, currently has subsidiaries that operate in the
following four segments: insurance and insurance services, specialty finance,
asset management and real estate. The Company’s principal investments
are included in a corporate and other segment. Tiptree Financial’s Class
A common stock trades on the NASDAQ Capital Market. All of Tiptree Financial’s
Class B common stock is owned by TFP. Tiptree Financial’s Class B common
stock has voting but no economic rights.
Tiptree Financial is a diversified holding company that draws upon the extensive
experience of its management team in the areas of insurance, specialty finance,
asset management, real estate and credit investing to acquire controlling interests
of operating businesses. We believe our business ownership mix of (i) specialty
insurance, insurance services and warranty protection companies, (ii) operating
companies which principally originate or own tangible assets, and (iii) asset
management companies which earn fees from third-party investment vehicles, provides
business synergies which generate a higher overall return on shareholder capital.
When making new acquisitions, we strive to identify businesses that: (i) have
strong and experienced management, (ii) have the potential to generate attractive
and stable cash returns on capital with limited downside, (iii) complement existing
businesses or strategies through clearly identifiable synergies, and (iv) have
sustainable and scalable business models. Tiptree’s permanent capital
base allows us to have a long term view of our businesses, providing a competitive
advantage relative to alternative capital sources with shorter-term objectives.
We will retain a well-performing business for an indefinite period, but will
consider selling a business when we believe material shareholder value creation
will be achieved.
When we acquire a business, we aim to partner with the management and employees,
providing assistance when needed, but relying on their unique expertise to run
the business day-to-day. We enhance the value of our businesses by utilizing
our experience in capital markets, mergers and acquisitions, capital raising,
credit markets, distressed investing, securitization, asset management, corporate
governance and government regulatory issues. We also optimize the efficiencies
of our business operations by strategically using the resources and talents
of our more than 900 employees at our consolidated subsidiaries.
We seek to adopt a prudent approach with regard to our capital structure, the
diversification of financial risk and the avoidance of reputational risk. We
evaluate our performance primarily by the comparison of our shareholder’s
long-term total return on capital to alternative investment options and major
market indices.
Tiptree’s insurance operations consist of Fortegra, a specialized insurance
and insurance services company offering consumer related protection products,
including credit insurance, non-standard auto insurance, warranties, service
contracts, auto warranty and roadside assistance. Fortegra also offers administration
services through a vertically integrated platform and provides fronting services
for self-insured clients.
Tiptree’s specialty finance operations consists of a controlling ownership
interest in Siena, which provides asset-based loans to smaller U.S. businesses,
our mortgage origination business, which is conducted through two entities,
Reliance, which is wholly owned and Luxury, which is 67.5% owned by the Company.
The Company intends to continue to grow its specialty finance operations organically
through increased volume, through acquisitions and by exploring strategic alternatives
with respect to new financing products.
Tiptree’s real estate operations consist of Care, a real estate investment
company focused on seniors housing.
The operations of Luxury and Reliance include the origination, packaging and
sale of mortgage loans, primarily FHA/ VA, conforming/agency and jumbo mortgage
loans. The loans are typically sold shortly after origination into a liquid
secondary market. Loans sold into the secondary market may be sold “servicing-retained”
or “servicing-released,” referring to whether the rights to service
the mortgage are retained by the originator or released to the secondary market
investor at the time of sale. Luxury and Reliance currently sell all of their
loans on a servicing released basis. Our mortgage business is financed using
warehouse revolving credit facilities to fund mortgage loans held for sale.
Revenues are generated from gain on sale of loans, net interest income and loan
fee income.
Tiptree’s asset management operations are conducted through TAMCO, an
SEC-registered investment adviser that is primarily a holding company for Tiptree’s
asset management subsidiaries, which include Telos and MCM. Telos primarily
manages credit related assets. MCM currently manages portfolios of tax exempt
securities for third parties and the Company. Tiptree seeks to grow its asset
management operations through acquisitions and through investments in new products
launched and managed by its subsidiaries.
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