MoneyMe and SocietyOne merge, set sights on becoming Australia’s top non-bank lender
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MoneyMe and SocietyOne will combine multiple synergies to become a serious, dominant player in Australia’s sophisticated fintech lending market.
The $132m deal has created a combined group capable of becoming a major player in the fast-growing Australian fintech lending industry.
The combination will harness SocietyOne’s strong brand recognition as a pioneer in personal lending, with MoneyMe’s leadership in product innovation and customer experience through its proprietary technology platform Horizon.
The transaction is also expected to immediately boost MoneyMe’s loan book by 68% to within sight of $1 billion. It will also produce around 63% lift in MME’s annualised revenues to $146m, as well as $17m of cost synergies through the medium-term.
“The SocietyOne acquisition combines two of the most widely recognised consumer credit disruptors to deliver immediate scale advantages and incremental revenue opportunities,” said MoneyMe CEO, Clayton Howes.
“The strategic value is immense for both businesses, and we are incredibly excited,” he added.
Both businesses bring complementary distribution capabilities that will span across digital, traditional, broker, agent and dealer, as well as delivering improved data.
Over $2b of combined customer origination data can be leveraged, which will improve credit risk management through advancements in credit underwriting, artificial intelligence (AIDEN), and customer behaviour analysis.
Both companies will also be able to pursue cross-selling opportunities, such as the introduction of the SocietyOne customer base to MoneyMe’s Horizon platform, which reduces funding time for consumer loans from one to two days to just a few hours.
There is also substantial cost savings of around $17m to be gained from the merger by removing duplicate functions, systems, premises and processes.
“Cost efficiencies will be delivered by migrating SocietyOne operations on to MoneyMe’s high-tech Horizon technology platform,” said Howes.
On top of that, new distribution opportunities can be unlocked by the merger according to Howes.
“There are many new innovations we will expand on, including the SocietyOne credit score product which will be brought to the MoneyMe customer base, and the Banking-as-a-Service partnership with Westpac that we will continue to explore,” he explained.
Under the deal, 89% of SocietyOne shareholders received around 66 million MoneyMe shares, with 11% of the consideration paid as cash, totalling just over $14.5m.
The bottom line is that it will give SocietyOne shareholders a 28% stake in MoneyMe post-transaction.
The combined business is expected to be a powerful force in the market, with the objective of accelerating the pace of winning market share from incumbent lenders.
“The SocietyOne brand will continue to thrive and will benefit from access to MoneyMe’s diversified product set and ability to deliver leading customer experiences,” said Howes.
“We are excited to be leading industry consolidation and fast-tracking our journey to become the number one non-bank credit provider in Australia.”
This article was developed in collaboration with MoneyMe, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.