Zip Co buys second NZ business in as many months
Written on the 6 September 2019 by Paris Faint
Less than a month after its successful acquisition of PartPay, Zip Co (ASX: Z1P) has bagged yet another New Zealand-based business.
The buy-now pay later giant, rival to the likes of Afterpay, has today announced its acquisition of Spotcap for a total consideration of almost $8.83 million.
The transaction is slated to provide Zip Co with Spotcap's SME credit decisioning platform which has originated more than $200 million worth of credit lines since its market inception in 2015.
Zip Co will also have access to around $23 million in Australian SME receivables and four years of credit performance data.
Managing director and CEO Larry Diamond says the acquisition will extend Zip Co's buy now pay later service further into the international and SME space.
"The strategic acquisition of Spotcap will fast-track the delivery of this product using a proven origination platform that is live in the Australian and New Zealand markets."
Chief operating officer and executive director Peter Gray added that Spotcap's approach to commercial underwriting is closely aligned with what Zip Co has built in the consumer space.
"What impressed us most about the Spotcap platform was the proven underwriting track record, the use of bank transactional data and smarts around cash flow forecasting."
Judging by its market activity and rate of new acquisitions, it's looking like Zip Co is on a roll.
On August 20 it announced the acquisition of PartPay which granted the company exposure to the lucrative New Zealand, United Kingdom, United States and South African markets.
Just two days later on August 22, the fintech cut its loss in half as it released FY19 results.
The company reported a loss before income tax of $11.1 million; a significant improvement on the $22.5 million loss recorded in the previous year.
This improvement been driven by a very strong result with revenue up 138 per cent at $84.2 million and customer numbers rising 80 per cent to more than 1.3 million.
Business News Australia
Author: Paris Faint