Searchlight Capital Companions, the personal fairness agency which has backed firms together with Secret Escapes, is to steer a brand new funding package deal for Wefox, the European insurance coverage firm, that could possibly be value as much as €170m (£141m).
Sky Information has learnt that Searchlight has successfully proposed stepping in to refinance Wefox’s current financial institution debt because the group seeks to keep away from a fire-sale of its most prized property.
Banking sources mentioned a deal was near being struck with Searchlight, which might be accompanied by an fairness elevate of between €80m (£66.5m) and €100m (£83.1m).
Final month, Sky Information revealed that current shareholders in Wefox, which operates throughout a swathe of European markets, have been preparing to back a fresh cash call.
This group is known to be led by Chrysalis, the London-listed investor in firms comparable to Klarna and Starling Financial institution, and Goal World.
One banker mentioned that if accomplished, the broader refinancing deal involving Searchlight could possibly be introduced as quickly as subsequent month.
The share sale has been designed to permit Wefox to avert a sale of TAF, certainly one of its prized subsidiaries.
It mentioned earlier this month that it had reached an settlement to promote its insurance coverage service arm to a bunch of Swiss firms led by BERAG, an unbiased supplier of pension companies.
Wefox can also be backed by outstanding buyers together with the Abu Dhabi state fund Mubadala.
The corporate has twice this yr warned that it confronted working out of cash inside months.
It has been ravaged by losses in quite a lot of its key markets together with Italy, though its operations within the Netherlands stay worthwhile.
The corporate was valued at $4.5bn (£3.6bn) in a funding spherical lower than two years in the past and counts Barclays and JP Morgan amongst its lenders.
It’s now valued at far lower than the $1bn (£796m) wanted to protect its standing as a tech unicorn.
Earlier this yr, the corporate purchased itself time by elevating roughly €20m (£16.6m) from current buyers, whereas it has additionally offered Assona, a subsidiary which provides insurance coverage cowl for electrical bikes.
Based in 2015, Wefox sells insurance coverage merchandise via in-house and exterior insurance coverage brokers, and has ceaselessly boasted of its ambition of revolutionising the insurance coverage business via using know-how.
It has greater than 2 million prospects throughout its enterprise.
In July 2022, Wefox raised a $400m (£318m) Collection D funding spherical valuing it at $4.5bn (£3.6bn), making it one of many largest fintechs in Europe.
That adopted a $650m spherical in Might 2021 valuing it at $3bn, reflecting the frothy urge for food of buyers to again scale-ups thought to be having the potential to develop into international rivals of real scale.
Neither Wefox nor Searchlight could possibly be reached for remark.
