Home / Corporate / Flamingo Ai sells for $100 to meet capital demands
25 May 2020
Listed insurtech Flamingo Ai is being sold to an investment company in a deal that will be put to shareholders in the middle of the year.
The buyer is Rymamay, a nominee for the Craig Neil Investment Trust, which agreed to pay a “nominal consideration” of $100.
Flamingo said last week that it made the decision to seek a buyer after it became clear it was unlikely to be able to raise the levels of capital it needs to service its current clients in Australia and the US, and to roll out its Intelligent Knowledge Sharing Hub.
“Given its rate of cash burn in order to execute on the current strategy the company would need to raise substantial capital, which it had been seeking,” Flamingo said in a statement to the Australian Stock Exchange last week.
Company founder and the current Head of Business Development, Catriona Wallace – who was the subject of a cover story in Insurance News magazine in April last year – has been given notice but will remain on the company’s board. Flamingo has proposed that CEO Olivier Cauderlier will continue in his role.
Under the proposed deal Rymamay will assume all the company’s assets, including all current and prospective customer agreements, all intellectual property, customer contracts and IT equipment.
Flamingo estimates it will have around $1.4 million in cash at the completion of the transaction.
In September the company revealed a full-year net loss of $7.2 million on revenue of $769,683 and said full-time headcount had been halved to 21.