eToro cancels $10B SPAC merger with FinTech V
The supposed $10B merger between eToro and FinTech V will no longer see the light of the day as the process has been canceled.
FinTech Acquisition Corp. V, a special purpose acquisition company (SPAC), reported on Tuesday that it had reached a bilateral agreement to end its planned takeover of Israeli cryptocurrency exchange eToro. Fintech V chairman Betsy Cohen explained the choice by saying:
“eToro continues to be the leading global social investment platform, with a proven track record of growth and strong momentum. Although we are disappointed that the transaction has been rendered impracticable due to circumstances outside of either party's control, we wish [CEO] Yoni and his talented team continued success.”
The two companies disclosed the SPAC buyout was valued at $10 billion last year. However, it looks that eToro has fallen into issues, perhaps as a result of the present bad market in cryptocurrencies, and needs a money infusion to improve its operations. According to reports, eToro is considering raising $800 million to $1 billion in private capital, valued at $5 billion.
Comparatively, Fintech V has roughly $250 million in cash and is traded on the Nasdaq exchange. Fintech V's only objective is to merge with a private firm so that it can “get” public listing status.
Yoni Assia, co-founder and CEO of Toro, provided the following assurance to the public regarding the condition of eToro's underlying business:
“Our balance sheet is strong and will continue to balance future growth with profitability. We ended Q2 2022 with approximately 2.7 million funded accounts, an increase of over 12% versus the end of 2021, demonstrating continued customer acquisition and retention rates that have been improving over time.”
