FinTech Mergers & Acquisitions announcements (America): April 2021

By Pavithra R

Successfully acquiring and integrating FinTech companies poses a major challenge. The article lists selected FinTech M&A announcements made in April.

Nuvei –  Mazooma

Nuvei, the global payment technology partner of thriving brands, has announced entering into a definitive agreement to acquire Mazooma Technical Services, a U.S. focused gaming and sports wagering payment technology provider for approximately $315 mn.

Mazooma is a payments technology company on a mission to simplify payments. It is registered with FinCEN and regulated as a money transmitter by various U.S. state banking departments. The FinTech is a leading account-to-account payments provider in U.S. online gaming and sports betting and is a registered vendor in 9 states, with permission in 12 states. Its Instant Bank Transfer payment solution features same-day Automated Clearing House (ACH) for pay-ins and payouts; and through a collaboration with Plaid, is connected to 11,000 FIs in the U.S.

Mastercard – Ekata

Mastercard has announced its plan to advance its identity verification efforts with the acquisition of Ekata for US$850 million.

Ekata is the new standard in global identity verification, providing businesses worldwide the ability to link any digital transaction to the human behind it. The firm works with a wide range of global merchants, financial institutions, travel companies, marketplaces and digital currency platforms. The FinTech uses insights to deliver unique scores, data attributes and risk indicators that businesses use to make informed decisions. Businesses leverage their product suite to increase approvals of more good transactions, reduce customer friction at account opening, and find fraud.

Ekata’s identity verification data, machine learning technology and global experience combined with Mastercard’s fraud prevention and digital identity programs will help businesses to identify who their customers are and, in turn, help those customers safely interact online. Mastercard and Ekata’s integrated services will build on both companies’ commitments to ensure trust and the responsible use of data.

Credijusto – Visor

Mexican FinTech Credijusto, a leading technology-enabled small business lender, has announced the acquisition of Visor, a data analytics and digital factoring platform.

Founded in 2015 by Rubén Sánchez Souza and Jean-Bernard Rolland, Visor has analyzed over 15,000 companies in Latin America. Its services have been used by over 40 FIs, marketplaces, and corporations to assess credit risk of the companies they do business with. The firm, as part of its international growth strategy, expanded its operations to Brazil three years ago. The company established itself as one of the leading players in the development of risk analysis tools for the Brazilian SME space, adapting to local business demands and information sources.

Visor’s competitive advantage lies in its technology and data analytics capacity. For Credijusto, the acquisition is highly strategic as it will enable the firm to expand its product suite and offer better solutions to its clients. The transaction supports Credijusto’s vision to become the leading financial services provider for LATAM SMEs by offering innovative solutions, including data analysis and digital factoring. For Visor, this deal represents an opportunity to scale its platform and attain significant impact in the market by teaming up with an important partner.

Affirm – Returnly

Affirm, providing significant disruptive innovation to the financial industry, has announced entering into a definitive agreement to acquire Returnly, a leader in online return experiences and post-purchase payments, for $300 mn.

Returnly is the leading provider of digital return experiences for direct-to-consumer brands. The firm uses financial technology to help direct-to-consumer brands offer the instant and seamless returns experience that their shoppers have come to expect. It serves more than 1,800 merchants and has helped process more than $1 bn in returns, and used by over 8 mn shoppers. Returnly takes the product return risk and settles orders in real-time, making returns and exchanges seamless and helping merchants drive higher return-to-repurchase rates, increased revenue from returns and higher customer satisfaction.

The acquisition comes as returns continue to be a source of increased costs and complexities for merchants. The transaction is expected to close in Affirm’s fourth fiscal quarter ending June 30, 2021.

CompoSecure – Roman DBDR

CompoSecure, a leading provider of premium financial payment cards and emergent provider of cryptocurrency storage and security solutions has announced entering into a definitive merger agreement with Roman DBDR Tech Acquisition Corp., a special purpose acquisition company.

Upon closing of the transaction, the combined company will operate as CompoSecure and will trade on the Nasdaq stock market. The deal values CompoSecure at a pro forma enterprise value of approx. $1.2 bn.

CompoSecure is the pioneer and leader in the design and manufacture of premium financial cards. Using its proprietary manufacturing methods that meet high standards of quality and security, and leading-edge engineering capabilities and technologies, the FinTech provides some of the largest banks and financial institutions, such as J.P. Morgan Chase and American Express, with innovative products that elevate their customers’ experience. Its innovative cryptocurrency cold-storage and security solution, Arculus, leverages its payment card technology and security expertise to advance cryptocurrency and other digital asset adoption. Arculus enables users to store and manage their digital assets using a secure payment card form factor and intuitive mobile wallet, incorporating a unique three-factor authentication system.

Also, read US Financial Services Technology Market Overview