Trading Platform eToro To Go Public In $10B SPAC Deal
eToro, a popular online platform for trading stocks and cryptocurrencies, is the latest technology company to take the SPAC route…
eToro, a popular online platform for trading stocks and cryptocurrencies, is the latest technology company to take the SPAC route towards an exit on the public markets. It’s sealed an agreement to merge with special-purpose acquisition company (SPAC) FinTech Acquisition Corp. V (NASDAQ: FTCV) in a deal valuing it at $10.4 billion.
FinTech Acquisition Corp. V is a SPAC launched by female business veteran Betsy Cohen.
- eToro is on a path to go public after nearly a decade and a half of existence, wherein it’s grown into a major online trading platform that drew $605 million in gross revenue in 2020. Particularly, 2020 was a very good year for eToro, wherein it says it added 5 million new registered users.
- In 2020, eToro says that it executed 27 million trades each month on average, compared to an average of 8 million trades per month in 2019. Now in 2021, the company reports having added 1.2 million new registered users and executing 75 million trades in January alone.
- Altogether, eToro has 20 million registered users from over 100 countries, it reports. The company supports cryptocurrency and stocks trading in many countries though it does not support stock trading in the US right now but has plans to do so beginning in the second half of this year. It has already secured a broker-dealer license from the American Financial Industry Regulatory Authority (FINRA) for that.
- eToro’s SPAC merger will see the $250 million of cash held in trust by FinTech Acquisition Corp. V handed over to the company, plus a $650 million PIPE round that’ll sum up its gross cash proceeds from the merger to $900 million. That PIPE round has been committed by investors including Fidelity, hedge fund Third Point, and Softbank Vision Fund 2.
- After its merger, eToro expects to have $800 million of net cash on its balance sheet to support future growth. The company’s SPAC merger is targeted to be completed in the third quarter of 2021.
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