Payoneer, a New York-based fintech company that specializes in facilitating cross-border payments, will go public by merging with a blank check company led by Bancorp founder Betsy Cohen, the companies announced on Wednesday.
The merger with Cohen’s SPAC, FTAC Olympus Acquisition Corp., values Payoneer at $ 3.3 billion. The transaction also includes a $ 300 million public investment in public capital (PIPE) from existing investor Wellington Management, as well as Fidelity Management & Research Company and Franklin Templeton, among others.
So-called “blank check” companies are formed for the sole purpose of buying another company and usually making it public within two years. SPAC offerings have experienced a hot crisis in the last year, as the pandemic and wild volatility continue to weigh on the traditional IPO market. In 2020, the volume of IPOs doubled from 2019, with 494 debuts totaling $ 174 billion – a 150% increase in dollars raised in 2019, according to FactSet. SPAC debuts accounted for half of them, while accounting for 56% of all Q3 IPOs and 52% of all Q4 IPOs.
But Cohen and her team were on the SPAC trend before the 2020 rage began: FTAC is the fourth shell company focused on fintech. A SPAC from 2018 announced a merger agreement at the end of last year with the payment provider Paya. Another, which went public in January 2017, was combined with International Money Express. The acquisition of FinTech, which went public in February 2015, combined with CardConnect, which was later acquired by First Data for approximately $ 750 million.
Payoneer was founded in 2005 by Yuval Tal, an Israeli entrepreneur who helped set up other technology and e-commerce payment companies. Scott Galit joined as CEO in 2010, after years at First Data and MasterCard.
“We chose to make Payoneer public through SPAC because it gives us the certainty of funding, more control over the timing and an incredible platform for future growth,” Galit told CNBC. “We have known Betsy and her team for a long time and we feel that we could not have a better partner. Her expertise in this industry, as well as FTAC’s recognized position as SPAC pioneers, presents a successful long-term partnership. “
Cohen’s acquisition takes place both during the growth period and in the calculation of digital finances. Last week, Robinhood found itself at the center of a riot after it restricted stock trading amid a retail frenzy and extreme market volatility crises. Meanwhile, the virus has accelerated technologies such as contactless payments and online banking and seen several large IPOs in space, including another CNBC Disruptor 50 company, Affirm. Online financial services company SoFi, which ranked 8th on the CNBC Disruptor 50 list in 2020, will go public by merging with a blank check company run by venture capitalist Chamath Palihapitiya.
Payoneer ranked both on the CNBC Disruptor 50 lists in 2017 and in 2018.
Nominations are open for 2021 CNBC Disruptor 50, a list of private start-ups that use cutting-edge technology to become the next generation of large public companies. Send by Friday, February 12, at 3:00 PM EST.