InsuLine Medical Ltd. (TASE: INSL), which recently entered the non-banking financing sector together with its medical device activity, now being kept on a low flame, today announced that it had issued NIS 10.5 million in bonds convertible into shares to IBI Investment House. The bonds bear 3.75% annual interest and for the next two years are convertible into shares amounting to 15% of InsuLine's capital. The conversion rate reflects a company value of NIS 60 million, compared with InsuLine's NIS 42 million market cap.
InsuLine said that it regarded IBI Investment's investment as a strategic one for its non-banking credit activity. The loan, however, is also linked to the company's medical device activity. If InsuLine sells medical products for more than $5 million a year, the company value for the conversion ratio will rise to NIS 70 million. There is an option for extending the conversion option, in which case the company value for conversion will be increased.
IBI Investment CEO Iddo Kook said today, "We regard the deal with InsuLine as an opportunity to develop the non-banking financing sector in IBI, which we believe will continue to grow in the coming years. In InsuLine, we have found a growing and promising platform for realizing this development."
InsuLine is currently controlled by Noam Ben-Nun, Yosef Wasserman, and Naor Eliyahu, who acquired their share through a merger with their non-banking credit company Yaad Sihan. InsuLine posted a NIS 2 million profit on NIS 3.6 million in revenue in 2017. The company also invested in cannabis company Medivie Therapeutic in the first quarter of 2018 and now has a 7.15% stake in that company. The results of its non-banking credit activity were published in July separately from its general reports.
Since the first announcement of its intention to merge Yaad Sihan into itself last October, InsuLine's share has lost 33% of its value. The share price rose at first, but gradually began to fade when the initial enthusiasm subsided after a month. It rose slightly again after the company published its results in the non-banking credit sector.
Published by Globes [online], Israel business news - www.globes-online.com - on August 8, 2018
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