Insurance coverage firm Lemonade stated late Monday it has agreed to purchase Metromile in an all-stock deal, a bid to jumpstart its auto-insurance enterprise that despatched shares of Metromile surging 7% larger in after-hours buying and selling.
The deal would worth Metromile
at about $500 million, Lemonade
stated. Beneath the phrases of the deal, Metromile shareholders will obtain Lemonade frequent shares at a ratio of 19 to 1.
Lemonade launched its automotive insurance coverage final week, and Metromile’s proprietary information and algorithms “can vault us over essentially the most time- and cost-intensive components of the journey,” Lemonade’s Chief Govt and co-founder Daniel Schreiber stated in a press release. “In an enormous and aggressive market like auto insurance coverage, in the present day’s deal is a large unlock of worth for our clients and shareholders.”
Lemonade has been on the forefront of utilizing “huge information and AI in residence and pet insurance coverage,” whereas Metromile has gone by “a parallel path for automotive insurance coverage,” Lemonade stated.
Metromile’s car-mounted sensors have lined billions of miles, cross-referencing the information streams with claims information and yielding “exact predictions” for losses per mile pushed, Lemonade stated.
The deal is anticipated to shut within the second quarter of 2022, pending regulatory approvals. Shares of Lemonade fell 6% within the prolonged session.
https://www.marketwatch.com/story/metromile-stock-rallies-13-after-lemonade-announces-acquisition-11636408552?rss=1&siteid=rss | Metromile inventory rallies 7% after Lemonade pronounces acquisition