Saturday, July 20, 2024

eToro cancels merger agreement, puts off public listing plans.

eToro has canceled a merger agreement with special purpose acquisition company (SPAC) FinTech Acquisition Corp V, which was announced in March 2021, because of the prevailing uncertainty in the market. There is no termination fee involved as the deadline for the transaction to be completed was June 30.

Yoni Assia, CEO of eToro, stated that this wasn’t the outcome they had hoped for when the two companies had started the process. He assured customers that eToro’s underlying business remains healthy. The company’s balance sheet is strong and will continue to balance future growth with profitability.

Assia shared that eToro ended Q2 2022 with about 2.7 million funded accounts – an increase of over 12% vs. 2021-end. It demonstrates continued customer acquisition and retention rates that have been improving over time. The merger was set to form a combined entity worth $10.4 billion. This reflects an implied enterprise value for eToro of about $9.6 billion.

Betsy Cohen, the chairman of FinTech V, said the transaction has been rendered impracticable because of circumstances outside either party’s control. He highlighted that the decision was taken mutually. As such, eToro and FinTech V are not required to pay a termination fee.

Crypto companies regard SPAC deals as a popular way to access public stock markets in recent years. But the downturn in the global crypto market has prompted companies to back off. Forbes, a business media outlet, had also intended to go public through a $630 million SPAC deal with Magnum Opus Acquisition Ltd. However, the deal was scrapped in late May.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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