Reliance Global Group Reduces Debt by 50%, Cuts Annual Debt Service by Over $1.8 Million

Reliance Global Group reduced long-term debt by $5.55 million (50%), cutting annual debt service by $1.8 million (61%). Proceeds from the sale of Fortman Insurance Services funded the debt repayment, enhancing financial flexibility for strategic initiatives. The reduction in debt service obligations allows for improved cash flow to support planned acquisitions and long-term financial health.

Reliance Global Group (Nasdaq: RELI) has announced a significant reduction in its long-term debt, repaying approximately $5.55 million, which represents a 50% decrease in its debt obligations [1]. The debt repayment was primarily funded through the $5.0 million proceeds from the sale of Fortman Insurance Services subsidiary, with additional funds from released cash collateral [1]. This strategic deleveraging has resulted in a substantial reduction in annual debt service requirements, decreasing from $2.95 million to $1.1 million, a 61% reduction in annual debt service obligations [1].

The company plans to utilize this improved financial flexibility to support strategic initiatives, including the planned acquisition of Spetner Associates [1]. The debt reduction creates $1.8 million in annual savings, strengthening financial flexibility for future acquisitions and growth [1].

The sale of Fortman Insurance Services, a wholly-owned subsidiary, for $5.0 million in cash, has significantly bolstered Reliance's financial position [2]. This asset sale marks a strategic move to monetize a non-core asset and further strengthen the company’s balance sheet [2]. The transaction was executed above the initial purchase price, demonstrating the strength of operational improvements made under Reliance’s ownership [2].

The reduction in debt service obligations directly strengthens free cash flow, which can be redirected toward operational improvements, technology investments, or strategic acquisitions [1]. This deleveraging marks a meaningful improvement in financial health, lowering financial risk and enhancing the company’s credit profile [1].

Reliance Global Group’s CEO, Ezra Beyman, stated, “Reducing our debt by approximately 50% marks a transformative milestone for Reliance and is a direct result of the financial execution and operational improvements made across the business. By lowering our annual debt service obligations by over $1.8 million, we are meaningfully enhancing our cash flow profile. These steps also create greater flexibility to support strategic initiatives, such as our planned acquisition of Spetner Associates” [1].

This debt reduction appears to be part of a larger strategic plan, as management indicated it partially executes on their strategy to fund the acquisition of Spetner Associates by improving their leverage ratio – a key metric for potential investors and lenders [1]. The timing suggests this move is preparatory for their planned acquisition, potentially enabling more favorable financing terms.

From a capital structure perspective, this deleveraging marks a meaningful improvement in financial health. Lower debt levels reduce financial risk, enhance credit profile, and preserve borrowing capacity for future growth initiatives [1]. The 61% reduction in debt service requirements directly strengthens free cash flow, which can be redirected toward operational improvements, technology investments, or strategic acquisitions [1].

Strengthened financial position and scalable tech platform pave the way for accelerated growth and margin expansion [1].

References:

[1] https://www.stocktitan.net/news/RELI/reliance-global-group-reduces-debt-by-50-cutting-annual-debt-service-xl5infzwxvsx.html

[2] https://www.insurancejournal.com/news/midwest/2025/07/08/830808.htm