Kredivo is the largest and fastest growing buy now, pay later
platform in Indonesia, Southeast Asia’s largest economy, fueled by
a rapidly growing middle class and e-commerce market
Institutional investors committed $120 million in a PIPE led by
Marshall Wace, Corbin Capital, SV Investment, Palantir
Technologies, Maso Capital, and sponsor Victory Park Capital, with
a concurrent equity commitment of $55 million from existing
FinAccel investors NAVER and Square Peg
Transaction assigns FinAccel, Kredivo’s parent company, an
expected pro forma equity value of approximately $2.5 billion and
is expected to deliver over $430 million of gross proceeds to the
company
Public listing expected to enable Kredivo’s continued growth in
Indonesia, expansion into regional markets, and the ability to
enter new business lines
FinAccel, the parent of Kredivo, the leading AI-enabled digital
consumer credit platform in Southeast Asia, and VPC Impact
Acquisition Holdings II (NASDAQ: VPCB) (“VPCB”), a special purpose
acquisition company sponsored by Victory Park Capital (“VPC”),
today announced that they have entered into a definitive agreement
for a business combination that will result in FinAccel becoming a
publicly traded company with an expected pro forma equity value of
approximately $2.5 billion, assuming no redemptions.
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Kredivo provides customers instant credit financing for
e-commerce and offline purchases, as well as personal loans, based
on proprietary, AI-enabled real-time decisioning. With nearly 4
million approved customers today and a presence across eight of the
top 10 e-commerce merchants in Indonesia, it is the largest and
fastest growing buy now, pay later (BNPL) platform in Indonesia
today, with plans to expand into regional markets such as Vietnam
and Thailand in the near future. Kredivo serves a target segment
that comprises the rapidly growing middle class of Indonesia, with
interest rates that are amongst the lowest in the country, and an
application and approval process that takes as little as two
minutes.
Kredivo has a track record of being a superior solution for
online and offline merchants. With less than 10% of the middle
class in Indonesia in possession of a credit card, merchants
partner with Kredivo to help increase customer spend. Surveyed
merchants that partner with Kredivo experience more than double the
average basket size, up to three times more frequent transactions,
and over 50% of these merchants say Kredivo helps increase cart
conversion rate during checkout.
“As the top buy now, pay later platform in Indonesia, Kredivo is
an established force in the large and rapidly growing point of sale
financing market,” said Akshay Garg, Co-Founder and CEO of
FinAccel. “Unlike Western markets where credit is readily
accessible, traditional banks in Southeast Asia have historically
provided little consumer credit in our markets, which creates a
large opportunity for Kredivo to tap into other credit needs, such
as personal loans, and fulfill our vision of providing fast,
affordable, and easily accessible credit to tens of millions of
customers in the region. Considering that 66% of Southeast Asia’s
population is unbanked or under-banked, we also see a very
attractive opportunity to serve these customers with other
financial services, outside of credit. We are proud to have the
continued support of our longstanding investors in our pursuit to
realize our long-term vision and growth strategy.”
Victory Park Capital, a global investment firm headquartered in
Chicago, has a long track record of executing debt and equity
financing transactions with some of the largest, most innovative
global fintech companies. VPC and Kredivo have a long-standing
relationship, with VPC providing an initial $100 million credit
facility to the company in July 2020 and upsizing it to $200
million in June 2021. In addition, VPC and its limited partners
have invested approximately $30 million into the PIPE and are
committed to a two-year lockup on their sponsor shares, unless
otherwise accelerated based on average trading performance measures
beginning one-year following the closing. VPCB completed its
initial public offering in March 2021.
“Since our initial investment in 2020, we continue to be
impressed by Kredivo’s rapid growth and strong credit metrics and
unit economics,” said Gordon Watson, Co-CEO of VPCB and Partner at
VPC. “The company has created an impressive platform that enables
it to expand into new markets. Its world-class management team has
a proven ability to not only execute on its strategy, but also
revolutionize fintech across Southeast Asia.”
FinAccel has been backed by high-quality investors including
Square Peg, Mirae Asset, NAVER, Jungle Ventures, GMO Internet, and
Telkom Indonesia.
Kredivo Highlights
- Operates within a fast-growing e-commerce market (over 20% per
annum) with the potential for $145B NMV by 2025
- Accelerating growth momentum with total user base doubling in
the last 10 months and annualized revenue doubling in the last
seven months
- Market leader with at least 50% BNPL wallet share across most
of the major Indonesian e-commerce merchants
- Average customer transacts 25x per year on the platform, a far
higher engagement rate than global peers
- Globally proven open-loop payments model with attractive unit
economics
- Deep regulatory moat with licenses in core and expansion
markets
- Proprietary AI-enabled risk models and collections processes
delivering risk metrics in line with banks’, and the ability to
scale risk models in other similarly credit deficient regional
markets
- Brings demonstrable value and has a track record of being a
superior solution for online merchants with 100% digital UX and
automation
- Durable growth vectors with a clear pathway to synergistic
expansion opportunities
Key Transaction Terms
Upon completion of the transaction, the combined company is
expected to have a pro forma equity value of approximately $2.5
billion, assuming no redemptions. It is expected to result in over
$430 million of cash on the combined company’s balance sheet,
reflecting a contribution of up to $256 million of cash held in
VPCB’s trust account (assuming none of VPCB’s stockholders redeem
their shares), a $120 million concurrent private placement (PIPE)
led by Marshall Wace, Corbin Capital, SV Investment, Palantir
Technologies, Maso Capital, and sponsor VPC, with a concurrent
equity commitment of $55 million from existing FinAccel investors
NAVER (through NAVER Financial) and Square Peg.
The proposed business combination has been unanimously approved
by the respective Boards of Directors of Kredivo and VPCB, and is
subject to approval by VPCB’s stockholders, regulatory approvals
and other customary closing conditions. The business combination is
expected to close no later than the first quarter of 2022.
A more detailed description of the business combination and a
copy of the Business Combination Agreement will be included in a
Current Report on Form 8-K to be filed by VPCB with the United
States Securities and Exchange Commission (the “SEC”). VPCB will
also file a registration statement (which will contain a proxy
statement/prospectus) with the SEC in connection with the business
combination.
Advisors
Goldman Sachs (Singapore) Pte. is serving as financial advisor
and Cooley LLP is serving as legal advisor to Kredivo. Citigroup is
serving as capital markets advisor to VPCB and Citigroup,
Jefferies, and Goldman Sachs (Singapore) Pte. are serving as
co-placement agents on the PIPE. White & Case LLP is serving as
legal advisor to VPCB.
Management Presentation
An on-demand investor webcast hosted by the management teams of
Kredivo and VPC Impact Acquisition Holdings II discussing the
proposed business combination can be accessed by visiting
https://event.on24.com/wcc/r/3340632/D0DC8D65B9B831777DDD8040D056A57D.
For materials and information, visit
https://finaccel.co/2021/08/kredivo-go-public-with-vpcii/ for
Kredivo and
https://www.victoryparkcapital.com/vih/vpc-impact-acquisition-holdings-ii/
for VPCB. VPCB will also file the presentation with the SEC as an
exhibit to a Current Report on Form 8-K, which can be viewed on the
SEC’s website at www.sec.gov.
Forward-Looking Statements
This document includes “forward-looking statements” within the
meaning of the federal securities laws with respect to the proposed
transaction between FinAccel Pte. Ltd. (“FinAccel”), AG1 Holdings,
Ltd. (“Kredivo”) and VPC Impact Acquisition Holdings II (“VPCB”),
and also contains certain financial forecasts and projections. All
statements other than statements of historical fact contained in
this document, including, but not limited to, statements as to
future results of operations and financial position, planned
products and services, business strategy and plans, objectives of
management for future operations of FinAccel, market size and
growth opportunities, competitive position, technological and
market trends and the potential benefits and expectations related
to the terms and timing of the proposed transactions, are
forward-looking statements. Some of these forward-looking
statements can be identified by the use of forward-looking words,
including “anticipate,” “expect,” “suggests,” “plan,” “believe,”
“intend,” “estimates,” “targets,” “projects,” “should,” “could,”
“would,” “may,” “will,” “forecast” or other similar expressions.
All forward-looking statements are based upon estimates and
forecasts and reflect the views, assumptions, expectations, and
opinions of VPCB and FinAccel, which are all subject change due to
various factors including, without limitation, changes in general
economic conditions as a result of COVID-19. Any such estimates,
assumptions, expectations, forecasts, views or opinions, whether or
not identified in this document, should be regarded as indicative,
preliminary and for illustrative purposes only and should not be
relied upon as being necessarily indicative of future results.
The forward-looking statements and financial forecasts and
projections contained in this document are subject to a number of
factors, risks and uncertainties. Potential risks and uncertainties
that could cause the actual results to differ materially from those
expressed or implied by forward-looking statements include, but are
not limited to, changes in domestic and foreign business, market,
financial, political and legal conditions; the timing and structure
of the business combination; changes to the proposed structure of
the business combination that may be required or appropriate as a
result of applicable laws or regulations; the inability of the
parties to successfully or timely consummate the business
combination, the PIPE investment and other transactions in
connection therewith, including as a result of the COVID-19
pandemic or the risk that any regulatory approvals are not
obtained, are delayed or are subject to unanticipated conditions
that could adversely affect the combined company or the expected
benefits of the business combination or that the approval of the
shareholders of VPCB or FinAccel is not obtained; the risk that the
business combination disrupts current plans and operations of VPCB
or FinAccel as a result of the announcement and consummation of the
business combination; the ability of FinAccel to grow and manage
growth profitably and retain its key employees including its chief
executive officer and executive team; the inability to obtain or
maintain the listing of the post-acquisition company’s securities
on Nasdaq following the business combination; failure to realize
the anticipated benefits of business combination; risk relating to
the uncertainty of the projected financial information with respect
to FinAccel; the amount of redemption requests made by VPCB’s
shareholders and the amount of funds available in the VPCB trust
account; the overall level of demand for FinAccel’s services;
general economic conditions and other factors affecting FinAccel’s
business; FinAccel’s ability to implement its business strategy;
FinAccel’s ability to manage expenses; changes in applicable laws
and governmental regulation and the impact of such changes on
FinAccel’s business, FinAccel’s exposure to litigation claims and
other loss contingencies; the risks associated with negative press
or reputational harm; disruptions and other impacts to FinAccel’s
business, as a result of the COVID-19 pandemic and government
actions and restrictive measures implemented in response;
FinAccel’s ability to protect patents, trademarks and other
intellectual property rights; any breaches of, or interruptions in,
FinAccel’s technology infrastructure; changes in tax laws and
liabilities; and changes in legal, regulatory, political and
economic risks and the impact of such changes on FinAccel’s
business. The foregoing list of factors is not exhaustive. You
should carefully consider the foregoing factors and the other risks
and uncertainties described in the “Risk Factors” section of
Kredivo’s registration statement on Form F-4, the proxy
statement/consent solicitation statement/prospectus discussed
below, VPCB’s Quarterly Report on Form 10-Q and other documents
filed by Kredivo or VPCB from time to time with the U.S. Securities
and Exchange Commission (the “SEC”). These filings identify and
address other important risks and uncertainties that could cause
actual events and results to differ materially from those contained
in the forward-looking statements. In addition, there may be
additional risks that neither VPCB nor FinAccel presently know, or
that VPCB or FinAccel currently believe are immaterial, that could
also cause actual results to differ from those contained in the
forward-looking statements. Forward-looking statements reflect
VPCB’s and FinAccel’s expectations, plans, projections or forecasts
of future events and view. If any of the risks materialize or
VPCB’s or FinAccel’s assumptions prove incorrect, actual results
could differ materially from the results implied by these
forward-looking statements.
Forward-looking statements speak only as of the date they are
made. VPCB and FinAccel anticipate that subsequent events and
developments may cause their assessments to change. However, while
Kredivo, VPCB and FinAccel may elect to update these
forward-looking statements at some point in the future, Kredivo,
VPCB and FinAccel specifically disclaim any obligation to do so,
except as required by law. The inclusion of any statement in this
document does not constitute an admission by FinAccel nor VPCB or
any other person that the events or circumstances described in such
statement are material. These forward-looking statements should not
be relied upon as representing VPCB’s or FinAccel’s assessments as
of any date subsequent to the date of this document. Accordingly,
undue reliance should not be placed upon the forward-looking
statements. In addition, the analyses of FinAccel and VPCB
contained herein are not, and do not purport to be, appraisals of
the securities, assets or business of the FinAccel, VPCB or any
other entity.
Non-IFRS Financial Measures
This document may also include references to non-IFRS financial
measures. Such non-IFRS measures should be considered only as
supplemental to, and not as superior to, financial measures
prepared in accordance with IFRS, and such non-IFRS measures may be
different from non-IFRS financial measures used by other
companies.
Important Information About the Proposed Transactions and
Where to Find It
This document relates to a proposed transaction between FinAccel
and VPCB. This document does not constitute an offer to sell or
exchange, or the solicitation of an offer to buy or exchange, any
securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, sale or exchange would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. The proposed transactions
will be submitted to shareholders of VPCB for their
consideration.
Kredivo intends to file a registration statement on Form F-4
(the “Registration Statement”) with the SEC which will include
preliminary and definitive proxy statements to be distributed to
VPCB’s shareholders in connection with VPCB’s solicitation for
proxies for the vote by VPCB’s shareholders in connection with the
proposed transactions and other matters as described in the
Registration Statement, as well as the prospectus relating to the
offer of the securities to be issued to FinAccel’s shareholders in
connection with the completion of the proposed business
combination. VPCB and Kredivo also will file other documents
regarding the proposed transaction with the SEC.
After the Registration Statement has been filed and declared
effective, VPCB will mail a definitive proxy statement and other
relevant documents to its shareholders as of the record date
established for voting on the proposed transactions. This
communication is not a substitute for the Registration Statement,
the definitive proxy statement/prospectus or any other document
that VPCB will send to its shareholders in connection with the
business combination. VPCB’s shareholders and other interested
persons are advised to read, once available, the preliminary proxy
statement/prospectus and any amendments thereto and, once
available, the definitive proxy statement/prospectus, in connection
with VPCB’s solicitation of proxies for its special meeting of
shareholders to be held to approve, among other things, the
proposed transactions, because these documents will contain
important information about VPCB, Kredivo, FinAccel and the
proposed transactions. Shareholders and investors may also obtain a
copy of the preliminary or definitive proxy statement, once
available, as well as other documents filed with the SEC regarding
the proposed transactions and other documents filed with the SEC by
VPCB, without charge, at the SEC’s website located at www.sec.gov
or by directing a request to VPCB. The information contained on, or
that may be accessed through, the websites referenced in this
document is not incorporated by reference into, and is not a part
of, this document.
INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN HAS NOT BEEN
APPROVED OR DISAPPROVED BY THE SEC OR ANY OTHER REGULATORY
AUTHORITY NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS
OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THE INFORMATION
CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
Participants in the Solicitation
VPCB, Kredivo and FinAccel and certain of their respective
directors, executive officers and other members of management and
employees may, under SEC rules, be deemed to be participants in the
solicitations of proxies from VPCB’s shareholders in connection
with the proposed transactions. Information regarding the persons
who may, under SEC rules, be deemed participants in the
solicitation of VPCB’s shareholders in connection with the proposed
transactions will be set forth in Kredivo’s proxy
statement/prospectus when it is filed with the SEC. You can find
more information about VPCB’s directors and executive officers in
VPCB’s final prospectus filed with the SEC on March 8, 2021.
Additional information regarding the participants in the proxy
solicitation and a description of their direct and indirect
interests will be included in the proxy statement/prospectus when
it becomes available. Shareholders, potential investors and other
interested persons should read the proxy statement/prospectus
carefully when it becomes available before making any voting or
investment decisions. You may obtain free copies of these documents
from the sources indicated above.
No Offer or Solicitation
This document is for informational purposes only and shall not
constitute an offer to sell or the solicitation of an offer to buy
any securities pursuant to the proposed transactions or otherwise,
nor shall there be any sale of securities in any jurisdiction in
which the offer, solicitation or sale would be unlawful prior to
the registration or qualification under the securities laws of any
such jurisdiction. No offer of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210802005686/en/
Kredivo
Investors ir@finaccel.co
Media Kevin Brown kevin@clarity.pr
VPC Impact Acquisition Holdings II
Media Jordan Niezelski, Edelman
jordan.niezelski@edelman.com
Investors vih2info@victoryparkcapital.com
VPC Impact Acquisition H... (NASDAQ:VPCB)
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