Metromile, the US-based online auto insurance provider backed by diversified conglomerate Mitsui and insurers China Pacific, AmTrust, Tokio Marine and Intact Financial, agreed yesterday to a reverse merger.
The company will join forces with Insu Acquisition Corp. II, a special purpose acquisition company sponsored by asset management firm Cohen & Company that floated on the Nasdaq Capital Market in a $200m initial public offering in September this year.
The merged business is expected to have a pro forma valuation of about $1.3bn and the deal will be supported by $160m private investment in public equity financing from Social Capital, Miller Value Partners, Clearbridge Investments, Hudson Structured Capital Management, New Enterprise Associates (NEA) and Mark Cuban.
Metromile’s automotive insurance service charges drivers by the mile as opposed to through a flat fee, enabling infrequent drivers to access cheaper rates. Customers can file claims through the company’s mobile app and it also offers healthy driving tips.
The transaction comes after more than $295m in funding for Metromile, including $15m from AmTrust investment vehicle AmTrust Ventures, NEA, Felicis Ventures, Allen and Company, Index Ventures, First Round Capital and SV Angel across rounds in 2012 and 2013.
The company later disclosed a total of more than $191m raised across rounds between 2014 and 2016, from China Pacific, Mitsui, Intact Financial, Index Ventures, NEA, First Round, SV Angel, Mark Cuban and Metromile founder and chairman David Friedberg.
Tokio Marine and Intact Financial co-led Metromile’s $90m series E round in mid-2018, investing alongside the Australian government’s Future Fund, NEA, Index Ventures and Section 32.
Metromile CEO Dan Preston said: “We are excited to bring our vision of transforming the auto insurance industry to the public markets by partnering with Daniel Cohen and the team at INSU II, whose deep experience in the insurtech space will help propel Metromile to the next level.
“Today’s announcement launches Metromile’s new chapter in delivering the fairest, most individualised auto insurance. As a public company, we expect to use our strengthened balance sheet to accelerate our growth, bring Metromile nationwide and scale rapidly toward sustained profitability. The era of fixed price auto insurance is coming to an end.”
