Chrysalis confident in Wefox despite reports of insolvency risk

17th May 2024 11:59

(Sharecast News) - Chrysalis Investments addressed recent media coverage concerning its portfolio company, Wefox on Friday, after Sky News reported that the European insurer had warned of an insolvency risk.

According to Sky, Wefox - which was valued at around £3.6bn less than two years ago - had warned shareholders that it could reach the end of its cash by the summer.

On Friday, Chrysalis confirmed ongoing discussions with Wefox management and other shareholders aimed at streamlining the insurer's business model to enhance profitability.

The company's investment adviser had reportedly expressed confidence in such a direction, believing it could yield a favourable outcome for both Wefox and Chrysalis's investment.

Recently, Wefox secured €20m from shareholders, with Chrysalis contributing €3m to support the strategy.

The investment adviser was committed to assisting Wefox in achieving its goals, and was optimistic about continued shareholder backing if additional support was needed.

On 4 May, Chrysalis announced that it had reduced the valuation of its investment in Wefox for the period ending 31 March.

The investment now represented 14.4% of Chrysalis's net asset value, down from 22.1% at the end of 2023.

At 1346 BST, shares in Chrysalis Investments were down 1.34% at 76.27p.

Reporting by Josh White for Sharecast.com.