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CURO to acquire Canadian POS/BNPL lender Flexiti for $121mn

By Pavithra R

February 01, 2021

  • Canada
  • Curo
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CURO Group Holdings, a market leader in providing credit to non-prime consumers, has announced entering into an agreement to acquire Flexiti Financial, an emerging growth Canadian POS/BNPL provider.

Under the terms of the deal, CURO will acquire Flexiti for cash at closing of $85 mn. The transaction also includes contingent consideration of up to $36 mn based on the achievement of risk adjusted revenue and origination targets over the next 2 years.

“Flexiti continues to grow at a rapid rate, and this transaction will enable us to accelerate our growth trajectory. I am tremendously proud of the success that Flexiti has achieved in its seven years of operations and I have no doubt we are better positioned than ever to provide great BNPL offerings to our retail partners and cardholders. Through this acquisition, Flexiti will leverage CURO’s financial strength, lending expertise and leadership across the credit spectrum to strengthen Flexiti’s position as a leading Canadian BNPL solution provider,” said Peter Kalen, founder and CEO of Flexiti.

Founded in 2013, Flexiti is a Canadian FinTech company providing tech-enabled solution offering financing options on a private label credit card that makes shopping simple for consumers and retailers. It’s Buy Now Pay Later (BNPL) platform enables customers to get approved for shopping with their FlexitiCard. Flexiti leverages mobile technology to deliver the fastest application process available today and generate the highest credit approvals with its flexible and responsible credit policy.

The acquisition diversifies CURO’s revenue mix by product and geography and accesses the full spectrum of Canadian consumers by adding an established omnichannel private label credit card platform and POS financing capabilities. 

Flexiti primarily serves prime consumers, and the combination presents notable revenue and earnings growth opportunities by using CURO’s expertise to expand Flexiti’s non-prime product offerings. The transaction also provides opportunities to leverage CURO’s loan servicing experience to improve Flexiti’s profit margins. 

“Flexiti is one of Canada’s fastest-growing BNPL providers with a market-leading omnichannel FinTech platform. This acquisition serves as an important milestone for CURO’s continued value creation in Canada, allowing the company to serve customers across all channels and with an expanded product set. CURO has been focused on M&A opportunities that align with our key strategic growth areas in Canada and cards, and this acquisition accelerates our progress on both fronts. Beyond the compelling strategic rationale and enhancements this transaction brings to our long-term growth strategy, Flexiti is a strong cultural fit for CURO. Credit risk management is a core competency for both companies that seek to optimize the balance between growth and prudent credit risk management to maximize long-term profitability. Both companies structure their businesses around the value of the omnichannel model and continually enhance their product suites to best meet the evolving needs of their customers. Flexiti’s management team and technology are first-rate, and the company is well-positioned to execute on a strategic plan that calls for continued rapid origination growth. I’m excited to welcome Flexiti to the CURO team and look forward to creating value for all of our stakeholders,” said Don Gayhardt, President and Chief Executive Officer of CURO.

The combination brings together two complementary businesses with like-minded management teams to serve prime and non-prime Canadian consumers directly or at the POS.

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