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Mogo Announces Business Combination with Difference Capital Financial

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Mogo Finance Technology Inc. (TSX:MOGO) (NASDAQ: MOGO) (“Mogo”) is pleased to announce the signing of a definitive arrangement agreement (the “Arrangement Agreement”) to merge Mogo (the “Transaction”) by way of a plan of arrangement with Difference Capital Financial Inc. (TSX:DCF) (“Difference”). Following the combination, the resulting company (the “Combined Entity”) is expected to be named ‘Mogo Inc.’.

Under the terms of the Arrangement Agreement, each common share of Mogo (a “Mogo Share”) will be exchanged for one (the “Exchange Ratio”) Difference common share (a “Difference Share”). Upon completion of the Transaction, former Mogo shareholders will own approximately 80% of the Combined Entity on a fully diluted basis. Following completion of the Transaction, all of Mogo’s outstanding convertible securities will become exercisable or convertible, as the case may be, for shares of the Combined Entity in accordance with the Exchange Ratio.

The Transaction is subject to Mogo shareholder approval, regulatory approval and satisfaction of other customary conditions. The Transaction is expected to close in the second quarter of 2019.

Transaction Highlights

  • Following the combination, the Combined Entity is expected to be named ‘Mogo Inc.’. Mogo shareholders will own approximately 80% of the Combined Entity and Dave Feller will be Chairman and CEO and Greg Feller will be President, CFO and Director of the Combined Entity.
  • The Combined Entity will continue to execute on Mogo’s vision of building the leading fintech platform in Canada. The combination will give Mogo immediate access to approximately $9 – $10 million in cash, which reflects proceeds from Difference’s two recently announced monetizations. In addition, Mogo will have control of Difference’s portfolio of investments in some of the premier private technology companies in Canada, including Hootsuite and Vision Critical, which collectively have an estimated fair market value of approximately $24 million.
  • The Transaction has received the unanimous recommendation of both Mogo’s and Difference’s special committees and respective boards of directors, with voting and support agreements representing approximately 21.8% of outstanding Mogo Shares and approximately 49.8% of outstanding Difference Shares executed in support of the Transaction.

“This transaction enables Mogo to continue to invest in new products and innovation, building on our leadership position in the Canadian fintech space,” said David Feller, Mogo’s Founder and CEO. “We are excited by the opportunity that the Transaction presents for shareholders of Mogo and Difference and are very pleased to have the support of the Difference board. We look forward to working closely with the leadership team at Difference to complete the Transaction.”

“The merger with Difference strengthens our financial position and represents a significant opportunity to create value for shareholders of the combined entity,” added Greg Feller, Mogo’s President. “Difference has invested in many of Canada’s leading technology companies and Mogo has built a valuable distribution platform. Shareholders of both companies will benefit from improved financial flexibility as we execute on our strategy of partnering to bring best-in-class products to our more than 800,000 members.”

Transaction Summary

The proposed transaction will be completed pursuant to a plan of arrangement under the Business Corporations Act(British Columbia) and, in addition to other customary closing conditions, is subject to regulatory and court approvals. The Transaction will need to be approved by: (i) two-thirds of the votes cast by Mogo shareholders at its shareholder meeting; and (ii) if required, a simple majority of the votes cast by Mogo shareholders at its shareholder meeting, excluding the votes held by certain persons as required by Multilateral Instrument 61-101. The directors and certain shareholders of Mogo, representing approximately 21.8% of Mogo’s outstanding shares, have entered into support agreements pursuant to which they agreed to vote their Mogo Shares in favor of the Transaction.

The annual general and special meeting of Mogo is expected to be held in June 2019. An information circular detailing the terms and conditions of the Transaction will be filed with regulatory authorities and mailed to the shareholders of Mogo in accordance with applicable securities laws. The Arrangement Agreement includes customary deal-protection provisions, including non-solicitation of alternative transactions and break fees payable by Mogo and Difference, respectively, under certain circumstances.

Mogo’s Board of Directors and Special Committee have determined that the proposed transaction is in the best interest of the shareholders, having taken into account advice from their financial advisors, and have unanimously approved the Transaction. Mogo’s Board of Directors recommends that their shareholders vote in favor of the proposed transaction.

Advisors and Counsel

Mogo’s financial advisor is Raymond James Ltd. and its legal counsel in Canada is Stikeman Elliott LLP. Raymond James Ltd. provided an opinion to Mogo’s Board of Directors that, as of the date thereof and subject to the assumptions, limitations and qualifications set out therein, the transaction is fair, from a financial point of view, to the shareholders of Mogo.

 

SOURCE Mogo Finance Technology Inc

Fintech

Wirex Launches Enhanced Cryptoback™

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Today, payments platform Wirex launched a supercharged update of their revolutionary Cryptoback™ rewards programme. Customers can now earn up to 1.5% back in Bitcoin on Wirex Visa card purchases.

Released in 2018, Cryptoback™ was the world’s first rewards programme that paid out 0.5% in cryptocurrency for all in-store spending with the Wirex Visa card. Thanks to the recent launch of the Wirex Token (WXT), customers can now triple the amount of BTC they earn – making investing in cryptocurrency easier than ever before.

Depending on the amount of WXT held, in-store Wirex card purchases now generate up to 1.5% in Bitcoin. There are three levels of crypto rewards available:

  • 500,000 WXT = 1.5% Cryptoback™
  • 100,000 WXT = 1.0% Cryptoback™
  • 50,000 WXT = 0.75% Cryptoback™

Wirex have calculated that the average UK consumer stands to earn more than £300 in Cryptoback™ every year, just by using their Wirex Visa card for day-to-day spending. Unlike many other cashback programmes, Wirex doesn’t impose restrictions on what customers can do with their rewards. Cryptoback™ can be redeemed instantly into their Bitcoin accounts, or quickly and easily exchanged into fiat for spending.

Enhanced Cryptoback™ is just one of the ways that holding Wirex Tokens allows customers to get even more out of their account. They can also enjoy heavily discounted fees based on the same structure, with access to premium products, merchant offers and airport lounges coming soon. As Wirex co-founder Pavel Matveev explains:

“We created the Wirex Token to be something that provides tangible value and benefits for holders beyond its market trajectory. Enhanced Cryptoback™ is the perfect example of this, as it allows customers to earn and invest in digital currency with a minimum of fuss. We’re looking forward to introducing even more benefits for WXT holders soon.”

 

SOURCE Wirex

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Fintech

Aegis Capital Corp. is pleased to announce its commitment to Equity Research

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Aegis Capital Corp. continues to expand its equity research platform with the addition of Benjamin Zucker and James Jang. Benjamin joined in May 2019 as Head of Specialty Finance and James joined in June 2019 to head up the Maritime & Special Situations. These new coverage areas will bolster Aegis’ existing research footprint in the Internet/TMT and Healthcare sectors.

Mr. Zucker joined Aegis from BTIG LLC, where he was a Director and lead analyst covering Mortgage REITs and real estate finance companies. Prior to BTIG, Mr. Zucker was a Vice President at JMP Securities LLC where he covered similar sectors. Benjamin began his career in equity research at Pritchard Capital Partners. At Aegis, Mr. Zucker’s coverage will span across several Specialty Finance sub-sectors including Mortgage REITs, Equity REITs, Business Development Companies (BDCs) and Financial Technology firms (FinTech). Benjamin’s current coverage list includes: Medalist Diversified REIT (MDRR), Sachem Capital Corp. (SACH), and Saratoga Investment Corp. (SAR).

Mr. Jang joined Aegis from Maxim Group LLC, where he was a Senior Vice President and lead analyst covering the Industrials, Infrastructure and Clean-Technology sectors. Previously, Mr. Jang was a senior analyst at Sidoti & Co. covering furniture and textiles and was an equity research associate at Canaccord Genuity covering Maritime and Upstream E&P companies. Since joining, Mr. Jang has expanded Aegis’ research platform into the Agriculture, Oilfield Services, and Industrial Technology sectors with coverage of Profire Energy (PFIE), Marrone Bio Innovations (MBII), Yield10 Bioscience (YTEN) and Sigma Labs (SGLB).

Michael Pata Aegis’ Head of Business Development commented: “Hiring Benjamin and James continues to show Aegis’ commitment to equity research, which brings institutional quality analysis to the small and mid-cap universe.”

 

SOURCE Aegis Capital

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LexinFintech Announces US$300 Million Private Placement of Convertible Notes with PAG

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LexinFintech Holdings Ltd. (NASDAQ: LX) (“Lexin” or the “Company”), a leading fintech platform for educated young adults in China, today announced that it has entered into a convertible note purchase agreement with PAG, a leading Asia-focused private equity firm with over US$30 billion in capital under management, pursuant to which the Company will issue and sell convertible notes in an aggregate principal amount of US$300 million to PAG through a private placement. The private placement is subject to satisfaction of customary closing conditions and is expected to close on or around September 16, 2019. The gross proceeds raised from this placement will be approximately US$296.4 million.

The convertible notes will mature in seven years, bearing interest at a rate of 2.0% per annum. The notes will be convertible into fully paid Class A ordinary shares of the Company or ADSs at a conversion price of US$14 per ADS at the holder’s option from the date that is six months after the issuance date.  The holder of the notes will have the right to require the Company to repurchase for cash all or any portion of the notes on the fourth anniversary of the issuance date.

At closing, the Company will appoint to its Board of Directors one person designated by PAG.

Mr. Jay Wenjie Xiao, Founder, chairman and chief executive officer of the Company, said, “We are excited to have PAG as our new investor. This investment will enable Lexin to further develop and enhance our consumption-based ecosystem, improve product offerings to our educated adult customers, continue to invest in technology, build up additional consumption scenarios, and provide more consumer benefits to our customers.”

“PAG has a strong commitment to and deep understanding of China’s financial services industry, and we have a demonstrated track record of seeking out and engaging with the industry’s leading companies,” said PAG Chairman & CEO Weijian Shan. “Lexin has an unparalleled platform for meeting young consumers’ credit needs while strictly controlling and minimizing credit risks, which makes it unique, and we are looking forward to supporting the company as it embarks on its next stage of growth.”

Goldman Sachs (Asia) L.L.C., BofA Merrill Lynch and China Renaissance acted as the private placement agents to Lexin on the transaction.

 

SOURCE LexinFintech Holdings Ltd.

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