The new vehicle, TruFin, will offer investors exposure to leading consumer lending P2P platform Zopa.
Arrowgrass’s fintech strategy has come into focus with a £70m IPO. The newly-listed vehicle, TruFin plc, has today announced the proposed admission of its shares to trading on the AIM Market of the London Stock Exchange. The £70m in proceeds (raised at 190p a share) has been secured from a mixture of institutional and professional investors.
Arrowgrass Master Fund Ltd is a hedge fund that has been investing in and acquiring fintech businesses since 2014. Its acquisitions include a trio of cash-flow finance focused fintechs: Distribution Finance Capital (supply chain finance), Oxygen Finance (dynamic discounting) and Satago (invoice finance). The fund also holds a 15 per cent minority stake in the world’s first peer-to-peer lender, Zopa, which was launched in 2005.
No UK-based peer-to-peer lender has yet gone public, meaning TruFin's IPO marks the first time investors have been able to gain exposure to one of the country’s P2P platforms.
It was clear that some kind of consolidation play was afoot at Arrowgrass when, in February of last year, the business oversaw the acquisition of Satago by Oxygen (which it already owned). The fund invested £15m in Zopa in January 2014.
Arrowgrass now says that its subsidiaries and investments are “set to scale”, having received significant investment in product, people and routes to market. Both Distribution Finance Capital and Zopa are in the process of pursuing banking licences.
Begun in 2013, Arrowgrass today has c. $6bn in assets under management, with offices in London and New York. The firm attributes its interest in P2P lending to the belief that platforms are “reliable originators of high-yielding assets”.
TruFin’s shares are expected to be admitted to the AIM Market at 08:00 on 21 February 2018, under the ticker TRU.
“I am delighted to announce our intention to join the AIM market of the London Stock Exchange. Listing on AIM will allow us to provide further capital to our subsidiaries and scale faster, and take advantage of any developments in the current financial services market,” said Henry Kenner, chief executive officer of TruFin plc.
“The highly experienced management team at TruFin and our group companies, are passionate about the opportunities to grow our niche lending businesses. Many borrowers are neglected by banks and still face expensive funding and capital. We intend to deliver value by taking advantage of current market disruptions and new financial technologies, while keeping a focus on the distribution of niche lending products.”
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