eToro Misses Deadline to Close SPAC Deal for Nasdaq Listing

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Israel-headquartered broker, eToro has likely abandoned its  merger  with blank-check firm, FinTech Acquisition Corp V (Nasdaq: FTCV), as it crossed the June 30 deadline for sealing the deal.

The Information also cited an anonymous source to report on Thursday that the broker is planning to abandon the deal. Finance Magnates reached out to eToro for official confirmation but did not receive any response as of press time (we will update the story accordingly).

A Broken Dream of Public Listing?

eToro, which has made its name with copy trading services, is a popular  retail trading  platform with a global presence. It also became popular by offering cryptocurrency services. The number of active customers on the platform doubled in 2021 to 2.4 million.

The broker confirmed its deal with Betsy Cohen-backed blank-check company in March 2021 that would allow it to list on the American stock exchange, Nasdaq. It initially missed its 2021 deadline to complete the merger, which was then extended to June 30, 2022.

Further, the slowdown in retail trading demand from the pandemic-induced peak also impacted the valuation of brokers, including eToro. Initially, the valuation of the merged eToro and SPAC was determined to be $10.4 billion, putting the implied enterprise value for eToro at $9.6 billion. However, the SPAC partner later confirmed a more than 15 percent cut in the valuation of the broker to $8.8 billion.

In May, an Israeli media company reported that eToro is considering raising between $800 million and $1 billion in a private equity round before its public listing. The funding is said to be coming at a valuation of around $5 billion and $6 billion, which is much less than the estimated valuation for the SPAC merger.

However, eToro at that time declined to confirm the funding or the valuation cut, calling it “market rumors.”

Israel-headquartered broker, eToro has likely abandoned its  merger  with blank-check firm, FinTech Acquisition Corp V (Nasdaq: FTCV), as it crossed the June 30 deadline for sealing the deal.

The Information also cited an anonymous source to report on Thursday that the broker is planning to abandon the deal. Finance Magnates reached out to eToro for official confirmation but did not receive any response as of press time (we will update the story accordingly).

A Broken Dream of Public Listing?

eToro, which has made its name with copy trading services, is a popular  retail trading  platform with a global presence. It also became popular by offering cryptocurrency services. The number of active customers on the platform doubled in 2021 to 2.4 million.

The broker confirmed its deal with Betsy Cohen-backed blank-check company in March 2021 that would allow it to list on the American stock exchange, Nasdaq. It initially missed its 2021 deadline to complete the merger, which was then extended to June 30, 2022.

Further, the slowdown in retail trading demand from the pandemic-induced peak also impacted the valuation of brokers, including eToro. Initially, the valuation of the merged eToro and SPAC was determined to be $10.4 billion, putting the implied enterprise value for eToro at $9.6 billion. However, the SPAC partner later confirmed a more than 15 percent cut in the valuation of the broker to $8.8 billion.

In May, an Israeli media company reported that eToro is considering raising between $800 million and $1 billion in a private equity round before its public listing. The funding is said to be coming at a valuation of around $5 billion and $6 billion, which is much less than the estimated valuation for the SPAC merger.

However, eToro at that time declined to confirm the funding or the valuation cut, calling it “market rumors.”

Source

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