ZipMoney Limited has secured $108 million in financing from Victory Park Capital. King & Wood Mallesons advised ZipMoney on the transaction. Based in Australia, ZipMoney is a digital retail finance provider.
Victory Park Capital (“VPC”), the U.S. asset management firm, announces today the successful closing of a $108 million asset-backed securitisation warehouse programme with zipMoney Limited (ASX: ZML) (“zipMoney” or the “Company”), a leading Australian digital retail finance provider. The facility allows zipMoney to accelerate its merchant acquisition strategy and provides the necessary funding capacity to support the growth in its consumer finance book.
Harsh Patel, at VPC, said:
“This is our first major deal in Australia where we see tremendous opportunity for Victory Park Capital to be a leader in the market. There is a clear void in the market as traditional financing sources remain reluctant to support the local FinTech sector. We believe that this is the right time to partner with zipMoney and are confident that the new lending facility will enable the Company to achieve substantial growth.”
Larry Diamond, managing director and CEO of zipMoney, said:
“This is a major step forward for the Company. Having access to such a substantial warehouse facility allows us to accelerate our merchant discussions and compete head to head with the major incumbents. There are now no barriers to onboarding enterprise merchants across zipMoney’s target markets.”
As part of the arrangement, zipMoney has established the zipMoney Trust 2015-1 (the Trust) with three classes of notes (unrated) issued by Perpetual Corporate Trustee Limited in its capacity as trustee. Pricing on all classes of notes is undisclosed. To establish the facility, c.$7 million of current loan receivables will be transferred to the Trust from the zipMoney Balance Sheet.
Peter Gray, chief operating officer and executive director of zipMoney, said:
“The facility is a great result and the Trust represents a compelling investment given the short weighted average life of the portfolio, small average contract sizes and strong diversification benefits.”
In addition to the credit facility, VPC will subscribe for five million fully paid shares in zipMoney to raise $1 million. VPC will also receive five million options exercisable at 20 cents each expiring on 31 December 2018. These securities will be subject to a voluntary escrow period of 12 months.
Mr. Diamond said:
“We are delighted to have VPC as a strategic partner and shareholder in our business. They are renowned specialists in the international FinTech sector and have worked with most of the major lending platforms across the globe. We look forward to working closely with VPC.”
The Agreement terms otherwise provide for conditions which are typical for this type of secured facility.
zipMoney Limited was advised by King & Wood Mallesons.
About Victory Park Capital
Victory Park Capital (VPC) is a privately held registered investment advisor dedicated to alternative investing through the management of its investment vehicles. As specialists in credit and private equity investments, VPC focuses on middle market companies across a diversified range of industries. Whether as a lender or a control investor, VPC seeks to identify opportunities where it believes the potential for reward outweighs the risks entailed. Founded in 2007, VPC is headquartered in Chicago with additional resources in London, Los Angeles, New York and San Francisco. For more information visit: www.victoryparkcapital.com.
zipMoney is a leading player in the digital retail finance industry. It offers point-of-sale credit and digital payment services to the retail, education, health and travel industries. It is focused on offering transparent, responsible and fairly priced consumer credit products. zipMoney’s platform is entirely digital and leverages big data in its proprietary decisioning credit engine to deliver real-time consumer responses. zipMoney is managed by a team with over 35 years’ experience in retail finance and is a licensed and regulated credit provider.