Formula Insurance Solutions has completed a $9 million private placement with two Israeli venture capital funds according to a post-money company value of $40 million.

FIS is a subsidiary of the Tel Aviv-traded company Formula Vision, which belongs to the Formula Systems (Nasdaq, TASE:FORTY) group. Its investors in this round were Genesis Partners and Giza GE Venture Fund.

FIS has been profitable for three years now, and should show 50% revenue growth this year to $20 million, says Formula Vision chairman Danny Goldstein.

The money now raised will be used to expand to new markets, mainly Europe, its main target.

Genesis and Giza received 23% of FIS's shares in this round, and received an option to buy another 28% of the company's equity. Formula Vision's holding was diluted from 51% to 37%.

FIS developed a software platform for insurance companies, called ALIS. The company, formerly known as Alon Systems, was established in 1993. It employs 140 people, half at its Tel Aviv management and R&D center and the rest in offices in Britain, France and Spain.