Sure-Tech Investments R&D Partnership (TASE: STEC.L) has reported the completion of the sale of half of its stake in risk management company Vesttoo, to an unrelated third party for about $7 million. The sale price is six times higher than the price for which it purchased the shares in April 2021. Sure-Tech received an offer to sell its full holdings in portfolio company Vesttoo for a similar amount, meaning it could have been paid $14 million but the company decided only to sell half of its holdings, due to its belief in Vesttoo's continued success.
Vesttoo has developed technology that allows insurance and reinsurance companies to transfer their insurance risks to the capital market by using financial instruments for the investment. The company was founded in 2018 by CEO Yaniv Bertele, CPO Alon Lifshitz, and CTO Ben Zickel.
Last November, Vesttoo completed a $15 million Series B financing round at a company valuation of about $300 million, after money and in full dilution. Sure-Tech made its first investment in Vesttoo in April 2021, when it invested $2 million at a company valuation of about $20 million, before money. Thus the investment in Vesttoo reflects an "on paper" profit for Sure-Tech of eight times its investment in less than a year. Sure_tech said that the significant rise in value of Vesttoo demonstrates the ability of the R&D Partnership to identify the right companies for investment.
Vesttoo has developed technology in the field of risk management, which allows insurance and reinsurance companies to transfer their insurance risks to the capital market through the use of financial instruments for the investment. These instruments are built by using artificial intelligence (AI) that assesses the risks of the insurance companies in an objective way and allows them to price their risks. The aim of Vesttoo is to solve the problem of the need to raise capital for the type and scale of activities and according to regulatory requirements - a trend that is likely to strengthen with the introduction of the Solvency II directive.
Sure-Tech is one of the R&D Partnerships that has held an Initial Public Offering (IPO) on the Tel Aviv Stock Exchange (TASE) over the past year, although it is the only one designed to invest only in innovative technologies for the insurance and finance sectors. The Partnership's CEO is Ran Tzror and the company's chairman is Uzi Danino. The company raised NIS 26.2 million in its IPO in April 2021.
Published by Globes, Israel business news - en.globes.co.il - on January 3, 2022.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.