Why merge?
Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Mahi Sall is the CEO & Founder of FinXpair, a Berlin-based strategic advisory boutique firm focu[...]
UK Equity Crowdfunding platforms Crowdcube and Seedrs to merge
Yahoo News Release Crowdcube and Seedrs | Oscar Williams-Grut | Oct 5, 2020
The UK’s two biggest crowdfunding platforms have announced plans to merge.
Crowdcube and Seedrs said in a joint statement on Monday they had agreed the terms of a merger. The combined company will be worth £140m ($181.2m).
Crowdcube will acquire Seedrs under the terms, with Crowdcube’s shareholders owning 60% of the combined business. Seedrs investors will receive 40%, reflecting the differing valuations of the two companies. Crowdcube was last valued at £84m and Seedrs is worth £56m. The exact financial terms weren’t disclosed.
“Today’s agreement is an incredibly exciting milestone that will benefit high growth businesses, their investors who believe in their vision and the wider entrepreneurial ecosystem that supports them,” said Darren Westlake, Crowdcube’s founder and chief executive. “Together with Seedrs, we can accelerate plans to further expand in the UK and overseas, launch innovative new products and improve our customers’ experience.”
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Westlake will serve as executive chairman of the combined business. Seedrs chief executive Jeff Kelisky will serve as CEO.
“We believe that you need to be a player of greater scale to serve companies and the investors who support them,” Kelisky said in a statement. “Now is the right time to bring our strengths together, in order to meet our common mission to deliver a step change in the accessibility and efficiency within private company investing.”
The merger is subject to approval by shareholders in both companies, the UK’s Competition and Markets Authority, and the Financial Conduct Authority. The deal is expected to close either at the end of this year or early in 2021.
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Seedrs Chairman Update | Jeff Lynn | Oct 5, 2020
Why merge?
By joining forces, we’ll be able to harness the best of both companies as we accelerate our shared mission to create the world’s largest private equity marketplace. Together, we will help fund thousands of ambitious, fast-growth businesses and deliver exceptional returns to the investors who support them.
In turn, the merger will allow us to create a more robust company, and we will be able to achieve our shared mission faster and more effectively when we are united.
How will the merger be structured?
The merger will be structured as an acquisition by Crowdcube Limited of all of the outstanding share capital of Seedrs Limited via scheme of arrangement. Existing Crowdcube shareholders and option holders will own 60% of the combined company, and existing Seedrs shareholders and option holders will own 40% of the combined company. This merger ratio reflects the approximate valuations of the two companies based on each of their most recent fundraising rounds.
See:
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The transaction is subject to approval by, among others, the UK Competition and Markets Authority (CMA), the Financial Conduct Authority (FCA) and shareholders of the two companies, as well as the sanction of the Court. The transaction is expected to be completed in late 2020 or early 2021.
What will the company look like after the merger?
Following completion of the merger, Jeff Kelisky will serve as CEO of the combined company, Darren Westlake, Crowdcube’s CEO and co-founder, will serve as Executive Chairman, and the management team will include key leaders from both businesses. The companies will then work together to define how the two businesses will combine their teams, customers, brands, services and technologies.
Going forward, the combined company will aim to deliver new innovations and products that will make it significantly easier, more affordable and valuable for ambitious businesses to raise growth finance, and for investors to have an even greater selection of investment opportunities with richer investment tools.
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The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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