QOMPLX, an InsurTech focused on cyber security risk analytics, said it will become a public company in a reverse merger agreement and then acquire two other companies.
The Virginia-based outfit disclosed it will be merging with special purpose acquisition company Tailwind Acquisition Corp. Plans call for closing the deal by mid-2021, pending stockholder approval and other closing conditions. At that point, QOMPLX will keep its name and list on the NYSE as QPLX.
“Reaching public markets via our partnership with Tailwind expedites QOMPLX’s ability to reach more customers globally and supports our continued development of the core technology platform for mission critical customer applications, Jason Crabtree, QOMPLX’s co-founder and CEO, said in prepared remarks.
After the transaction is completed, QOMPLX will have an equity value of approximately $1.4 billion, with up to $280 million in gross cash proceeds, according to the deal announcement. As well, the transaction includes a fully committed PIPE (private investment in public equity) of $180 million, anchored by Cannae Holdings, though institutional investors including Fidelity Management & Research Company LLC, Hedosophia and RenaissanceRe Ventures Ltd. also participated.
As part of the deal, QOMPLX has also agreed to acquire Sentar, a cyber intelligence and analytics firm focused on the National Security sector, and Tyche, an insurance modeler focused on pricing risks, reserving capital and improving efficiency.
QOMPLX describes itself as helping organizations to make intelligent business decisions and better manage risk through an advanced, proprietary risk cloud platform. The goal: to help organizations better quantify, model, and predict risk in areas including cybersecurity, insurance, and finance.
QOMPLX said its pro forma 2021 revenue should be $141 million. In 2020, that revenue base was $96 million. The company said it has more than 95 enterprise and government customers.
InsurTechs have been increasingly using the special purpose acquisition company/reverse merger option to hit the public markets, rather than a traditional initial public offering. Among them: Metromile recently became a public company through a reverse merger, and Hippo is reportedly pursuing a SPAC option as well.