FinAccel, a Singapore-headquartered consumer credit service backed by corporates Singapore Telecommunications, Telkom Indonesia, Telkomsel, Naver and GMO, has scrapped a planned $2.5bn reverse merger due to unfavourable market conditions.
The agreement was struck with special purpose acquisition company VPC Impact Acquisition Holdings II (VPCB), which is sponsored by investment manager Victory Park Capital (VPC), in August 2021 and would have valued the combined company at approximately $2.5bn.
The transaction would have been supported by $120m in private investment in public equity (PIPE) financing from data mining software producer Palantir, Corbin Capital, Marshall Wace, SV Investment, Maso Capital and VPC itself. Teleommunications firm Telekom Indonesia’s MDI Ventures unit agreed in October to also contribute to the PIPE.
FinAccel owns and operates Indonesia-based buy now, pay later (BNPL) service Kredivo, which lets shoppers finance purchases over a number of instalments, and which is slated to expand into other markets in Southeast Asia such as Vietnam and Thailand.
Although the deal is not going through, VPCB is leading a $145m private funding round for Kredivo, which will consider participation from others that had previously committed to the PIPE.
FinAccel’s CEO, Akshay Garg, said: “While unfavourable market conditions have put a pause to our plans to go public in the near-term via the proposed business combination with VPCB, we are pleased to deepen our relationship with VPC and other high-quality investors through a new private funding round.
“We appreciate the support of our investors as we continue on the path to realising our long-term vision and growth strategy to become a leading digital financial services platform in Southeast Asia.”
The company was valued at $500m in its last round, a $90m series C in 2019 featuring telecoms firms Telkomsel Indonesia and Singapore Telecommunications (through Singtel Innov8) and Asia Growth Fund, a vehicle for internet group Naver and financial services provider Mirae Asset.
Reinventure, the venture capital firm backed by financial services firm Westpac, also took part in the round, as did Mirae Asset Securities, Cathay Innovation, Kejora Intervest and DST Global. Its earlier backers include MDI Ventures and GMO Venture Partners, a subsidiary of internet company GMO.
