Chrysalis falls on broker bid to break up Wefox (2024)

Private Equity 14 Jun, 2024

A reported bid by broker Ardonagh for the best bit of loss-making online insurer Wefox is being resisted by Chrysalis Investments and other shareholders.

By Gavin Lumsden

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Shares in Chrysalis (CHRY) have taken another knock after a report of a €550m (£463m) bid approach for Wefox that could leave the fund and other shareholders with the riskiest rump in the loss-making insurance fintech.

Bloomberg reported that insurance broker Ardonagh is preparing an all-share offer of €350m up front with €200m in earn-out payments if Wefox meets subsequent targets. Abu Dhabi sovereign wealth fund Mubadala Investments is said to support the plan as under the terms of its investment in Wefox it is guaranteed to double its initial outlay on a sale of the company.

Wefox founders, Chrysalis and fellow investor Target Global are said to object to the deal, however, as it would split the company in two with Ardonagh taking the core of the company and leaving other shareholders with its technology platform and Swiss business. That would put them at risk at of losing their entire investment if they could not turn round the remaining operations.

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Chrysalis falls on broker bid to break up Wefox (2024)

A reported bid by broker Ardonagh for the best bit of loss-making online insurer Wefox is being resisted by Chrysalis Investments and other shareholders.

To continue reading, register for a free Citywire account

To read this article please sign in

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Investors like to investment companies buy back their stock when the shares trade on deep discounts, as one early-stage investor was pleased to discover this week.

GAVIN LUMSDEN, CITYWIRE INVESTMENT TRUST INSIDER

Editor’s Picks

Get the latest news in your inbox

Videos & podcasts

Financial giants Blackstone and TPG have both recently acquired Canadian real estate firms, says Middlefield Canadian Income fund manager Dean Orrico.

COMMENT & ANALYSIS

Shares in a leading infrastructure fund look good value as its board becomes more focused on improving shareholder returns after a tough two years for the stock.

GUIDES

Discounts – where investment trust share prices trade below their underlying value – are sometimes presented as a good thing. Are they, asks Gavatar?

References