US insurance and financial giant AmTrust is investing NIS 72.6 million in Israeli digital insurance company weSure Global Tech (TASE: WESR), at a price well above the current market price. The two sides signed a “significant private placement agreement.” weSure also controls Israeli traditional insurance company Ayalon.
Following the announcement, WeSure’s share price jumped 16%, reaching a market value of NIS 292 million. Over the past year, WeSure’s share price has risen 81%, though the stock is still down 70% from its peak in May 2021, several months after its IPO.
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AmTrust will invest NIS 72.6 million in WeSure in two stages. Initially, NIS 16 million for a 5% stake, and in the second stage, subject to approval by the Israel Securities Authority, AmTrust will invest an additional NIS 21 million, bringing its stake to 10% (at NIS 3 per share, significantly above the market price). AmTrust will also convert an existing NIS 35.6 million loan into common stock, based on an updated conversion price of NIS 4.8 per share, instead of the originally announced NIS 6.3 per share. Ultimately, WeSure’s stake could reach 15.3%.
WeSure says the transaction, which is strategic for it, will further enhance WeSure Global Tech’s equity, reduce its financial leverage, and further strengthen cooperation with strategic investor AmTrust in the group’s activities in Israel and the United States.
This article was published in Globes, Israeli Business News – en.globes.co.il – on July 9, 2024.
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