Ondo InsurTech, the London-listed insurtech group, announced on Tuesday that it has reached an agreement with its largest shareholder, Homeserve Assistance, to restructure its five-year loan notes. This move aims to provide additional financing for the company’s rapid expansion.
As a result of this development, Ondo InsurTech’s shares experienced a significant boost, rising 10% to 23.7 pence at 0743 GMT.
The loan notes, which were obtained as part of the acquisition of the LeakBot business from Homeserve in 2022, offer interest-free financing until March. These non-dilutive flexible funds will support Ondo InsurTech’s ongoing deployment of its LeakBot system.
Key features of the loan restructuring include the deferral of interest payments from March 2024 to March 2025, the postponement of the first repayment of principal amounts from March 2025 to March 2026, and an extension of the final redemption deadline to March 2029.
Furthermore, the interest rate has been adjusted from 10% to 12% starting in March 2024.
Ondo InsurTech’s CEO, Craig Foster, highlighted the significance of this financial flexibility provided by their largest shareholder. He emphasized that it will greatly support the company’s efforts to achieve profitability, especially as they prepare to roll out their contracts in Denmark, Sweden, the U.K., and the U.S.
