Summary
Intuit Inc. (INTU) announced on November 27, 2000, a significant strategic transaction involving its wholly-owned subsidiary, Intuit Insurance Services, Inc. (IIS). Intuit has entered into an Asset Purchase Agreement to sell selected assets of IIS to InsWeb Corp. This move signals a shift in Intuit's insurance business strategy, divesting direct asset ownership while seeking to leverage a partnership for distribution. As part of the deal, Intuit will receive a substantial equity stake in InsWeb, acquiring 19.9% of InsWeb's current shares (16.6% on a post-closing basis). Furthermore, Intuit and InsWeb will enter into a distribution agreement making InsWeb the exclusive consumer insurance aggregator for Intuit's prominent Quicken.com and QuickenInsurance websites, as well as certain Quicken desktop products. This partnership is designed to generate revenue for Intuit through shared revenues with minimum guarantees over a five-year term, aligning Intuit's online presence with a specialized insurance aggregation platform.
Key Highlights
- 1Intuit Inc. is selling selected assets of its wholly-owned subsidiary, Intuit Insurance Services, Inc. (IIS), to InsWeb Corp.
- 2Intuit will acquire a significant equity interest in InsWeb, representing 19.9% of its currently issued shares (16.6% post-closing).
- 3A distribution agreement will make InsWeb the exclusive consumer insurance aggregator for Intuit's Quicken.com, QuickenInsurance websites, and certain desktop products.
- 4Intuit will participate in associated revenues from the distribution agreement, with certain minimums guaranteed over a 5-year term.
- 5The transaction has board approvals from both Intuit and InsWeb.
- 6The deal is expected to close in the first calendar quarter of 2001, pending regulatory and customary closing conditions.