In a strategic move to expand its presence in the InsurTech industry, Reliance Global Group has officially announced its entry into a Letter of Intent (LOI) to acquire The Target, a well-established benefits enrollment company. This move marks a significant milestone for Reliance Global Group, triggering a notable surge in its stock value.
As of Tuesday’s close, Reliance Global Group’s stock was trading at $0.85. However, with the news of the impending acquisition, the stock witnessed a surge, opening at $0.88 on Wednesday morning and reaching a current trading value of $1.30.
At the time of this publication, Reliance Global Group Inc stock (RELI) has witnessed a surge.
Reliance Global Group Inc
Current Price: $1.17
Change : +0.32
Change (%): (37.62%)
Volume: 5.6M
Source: Tomorrow Events Market Data
The Target, recognized as a leading provider of voluntary benefits, serves approximately 45,000 employees across the United States. Renowned for its innovative use of cutting-edge technology, The Target has set itself apart in the benefits enrollment industry. The acquisition, contingent upon the execution of a definitive agreement and other customary closing conditions, is anticipated to conclude in the first quarter of 2024.
Ezra Beyman, the CEO of Reliance Global Group, expressed enthusiasm about the impending acquisition, stating, “We are excited to announce our most significant planned acquisition to date, which would more than double our current revenue and provide attractive EBITDA returns.” Beyman further outlined the financial impact, indicating that The Target is expected to generate over $21 million in revenue during fiscal year 2024. This substantial increase is poised to elevate Reliance’s consolidated revenue by more than 100%, reaching $35 million. Beyman anticipates this surge in revenue to result in significant cash flow for the combined companies in 2024 and beyond.
Highlighting the strategic advantage of the acquisition, Beyman emphasized The Target’s diverse voluntary benefits programs spanning various industries. This addition is expected to enrich Reliance’s overall product offerings, aligning seamlessly with Reliance’s OneFirm go-to-market platform. Beyman sees the acquisition as an opportunity to tap into enhanced synergistic opportunities and integrate The Target into the Reliance family effectively.
As the market reacts to this development, the stock performance of Reliance Global Group has experienced fluctuations over the past few days. The five-day trend reflects a 4.40% increase, indicating a positive response to the acquisition news. However, the one-month, three-month, year-to-date (YTD), and one-year performances reveal fluctuations of -20.67%, -41.95%, -86.03%, and -86.29%, respectively.
Investors and industry analysts are closely watching the unfolding developments as Reliance Global Group positions itself for substantial growth through this strategic acquisition. The completion of the transaction in the first quarter of 2024 is anticipated to mark a transformative moment for both Reliance Global Group and The Target, shaping the landscape of the InsurTech industry.
