A Botched Insurtech Merger

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A Botched Insurtech Merger

Stock markets are strange beasts, these swarms of collective greed and fear and other human foibles. Markets are so vast and volatile that history provides many episodes of manipulation, successful and unsuccessful. Tens of thousands of analysts and journalists worldwide are trained to divine meaning from their vicissitudes. Sometimes those insights achieve genuine wisdom, other times…markets be markets, and there’s little to take away beyond the fact that some people made money from short-term movement and others lost.

As FIN noted back in February, the once frenzied insurtech sector has been battered by its encounter with the stock market. That trend appeared to reverse itself in recent weeks. On June 21, the Wall Street Journal broke the story that the Columbus, Ohio-based insurtech pioneer Root had received a generous takeover bid from a Park City, Utah-based company called Embedded Insurance. The Journal reported that the offer was for $19.34 a share. As the paper put it, with considerable understatement: “That would be a significant premium to Root’s closing price Tuesday of $6.02, which gives the company a market value just north of $80 million, below its peak of as much as $7.5 billion.”