Porch Group and Covéa terminate CSE deal
In September 2021, Porch Group announced that it was acquiring Covéa’s California-based personal lines insurer CSE Insurance for $48.6 million.
Now, the companies are announcing that they are mutually terminating the deal. Covéa didn’t share much information in its press release for this decision, but Porch Group CEO Matt Ehrlichman shared the following: “Given the change in the market and the increase in the cost of capital, we are confident there are other ways to deploy the approximately $50 million in cash that would have been used for purchase price and look forward to creating long-term value for Porch Group shareholders.”
No breakup fees are owed by either party as a result of the termination.
This week, Porch announced its second quarter results:
- Revenue was $70.8 million, an increase of $19.5 million from the second quarter of 2021.
- GAAP net loss totaled $26.4 million, compared to a GAAP net loss of $16.3 million for the second quarter of 2021.
- Insurance revenue was $28.0 million, revenue less cost of revenue was $11.4 million or 40.8% of insurance revenue, and GAAP net loss was $6.9 million.
- Insurance gross written premium was $145 million with 379k policies.
The Porch Group share price went from a high of ~$24 in November 2021 to $3.15 today.
