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Enova Announces Completion of OnDeck Acquisition
13 October 2020 14:16 GMT
Enova (NYSE:ENVA) announced on Tuesday it has officially completed the acquisition of online lender OnDeck (NYSE:ONDK). Enova revealed in July 2020 it had purchased OnDeck for $1.38 a share, including $0.12 in cash.
As previously reported, Enova is a provider of online financial services to non-prime consumers and small businesses, providing access to credit. Enova has provided more than six million customers around the globe with access to more than $20 billion in loans and financing. The company notably has been growing its small business lending portfolio but the acquisition of OnDeck drives this segment from 15% of its business to about 60% of its lending operations.
Under the terms of the agreement, OnDeck shareholders received 0.092 of a share of Enova common stock and $0.12 in cash for each share of OnDeck held. Enova noted that the transaction is to result in approximately $50 million in annual cost synergies and approximately $15 million in run-rate net revenue synergies to be fully phased-in by year-end 2022. The company also revealed:
“In connection with the transaction, Enova will grant $1.16 million payable in restricted stock units (RSUs) of Enova common stock to Noah Breslow, OnDeck’s former CEO, who will become an Enova employee following the transaction. The award will be granted shortly after the closing of the transaction, and subject to the terms and conditions of the applicable award agreement. Portions of the award will vest six months and twelve months from the date of the grant.”
Speaking about the acquisition, David Fisher, CEO of Enova, noted that the acquisition establishes Enova as a “premier” fintech lender with a “substantial scale and a diversified brands and product pro folio. Fisher then stated:
“The operational integration plans and ability to recognize meaningful synergies and financial benefits of the acquisition are on track. We remain well positioned to drive long-term, profitable growth for our shareholders while addressing the needs of consumers and small businesses whose need for access to credit is even more critical in the wake of the COVID pandemic and current economic environment.”
Enova then added that in connection with the closing of the acquisition, ONDK’s common stock will cease to be publicly traded on the NYSE today.