Swedish lending startup Trustbuddy has announced the acquisition of Dutch peer Geldvoorelkaar, as well as the acquisition of Italian platform Prestiamoci, forming a pan-European P2P lending platform.
Trustbuddy, a Nasdaq OMX North (Swedish) listed startup in peer-to-peer and short-term lending, has entered into an agreement to acquire both Italian Prestiamoci for a total of EUR5.3 million and Dutch startup Geldvoorelkaar for a consideration of EUR10.6 million. It’s goal is to strengthen its offering of business loans to small and medium-sized enterprises and consumer credit in most European countries.
Geldvoorelkaar is the first P2P lending platform with a credit licence issued by the Dutch Financial uthority (AFM). Geldvoorelkaar offers a professional and established alternative source of financing for SMEs.
Geldvoorelkaar was founded (read operational) in 2012 by Martijn van Schelven and Edwin Adams. It was the first P2P lending platform in the Netherlands to receive AFM permits and has since grown to an estimated 60-65% market share.
Year to date, Geldvoorelkaar has funded EUR20 million of SME (small and medium enterprise, aka ‘MKB’) loans with an average revenue margin approaching 6%. The startups is profitable with EUR1.6 million of expected revenues for 2014 and expected earnings before interest and tax of EUR0.7 million.
Trustbuddy CEO Jens Glasoe on the rationale behind this deal: “[The deal with Geldvoorelkaar] opens up European SME market opportunities to TrustBuddy. [We] believe there to be substantial demand for alternative lending sources in the Nordic market in particular in P2P lending in the Netherlands.”
The companies have even released a detailed breakdown of the EUR10.6 million acquisition price agreed upon for Geldvoorelkaar. The consideration comprises EUR3 million cash, EUR4 million through the issue of new shares at a 20% premium to the pre-announcement share price and a EUR3.6 million vendor loan of which 50% is redeemed in January 2016 and 50% redeemed in January 2017. Shares issued as part of the consideration will be subject to lock-up restrictions which expire in January 2016 in respect of 50% of the shares and January 2017 for the remainder.
Both acquisitions remain subject to the satisfaction of certain conditions. In particular, the acquisition of Prestiamoci is conditional upon Prestiamoci receiving a payment services, PSD, license. To fund (a large part of the acquisitions) Trustbuddy is in the process of raising new equity of EUR10 million via a bookbuild. The EUR10 million will be used for the acquisitions, as well as to fund improvements to the platform.
Photo by Pieter van Marion (creative commons via Flickr)