- Savings and investing app company Acorns Grow Incorporated entered into a definitive business combination agreement with Pioneer Merger Corp. (NASDAQ: PACX). These are the details.
Savings and investing app company Acorns Grow Incorporated entered into a definitive business combination agreement with Pioneer Merger Corp. (NASDAQ: PACX), a publicly-traded special purpose acquisition company (SPAC). The combined company will continue as a publicly listed entity and have an expected pro forma fully-diluted equity value of approximately $2.2 billion, assuming no redemptions.
Institutional investors including Wellington Management, Senator, Declaration Partners, Greycroft, The Rise Fund, TPG’s global impact investing platform, and funds and accounts managed by BlackRock participated. And the oversubscribed, upsized PIPE was raised at $10 per share.
With a mission to look after the financial best interests of the up-and-coming, Acorns grew into one of the largest subscription service in U.S. consumer finance with 4+ million loyal subscribers saving and investing for a better future together. And going public will help accelerate the company’s growth and put the responsible tools of wealth-making in everyone’s hands when they need it most.
The deal is expected to close in the second half of 2021. And upon completion, the company will operate as Acorns Holdings, Inc. and is expected to trade under the symbol “OAKS” on the Nasdaq Capital Market. The new Acorns is going continue to be led by Noah Kerner, Chief Executive Officer, and the company’s experienced management team.
As part of the merger deal, Kerner plans to contribute 10% of his personal ownership in Acorns to fund a novel program giving shares to eligible customers. And Pioneer’s sponsor is also planning to give 10% of its ownership in Acorns to this same program.
Launched as of the end of 2014, Acorns grew rapidly to help everyday Americans responsibly manage their money for the long term. And Acorns combines education, investing, banking, and earning into a cohesive experience that puts the tools of wealth-making in everyone’s hands.
Acorns pioneered a subscription-based pricing in the financial industry with three membership levels:
— Lite ($1/mo) which includes basic investing, education, and earning tools;
— Personal ($3/mo) which adds retirement, banking, and smart deposit tools to invest and grow more;
— Family ($5/mo) which includes all individual products plus Acorns Early – investing, education, rewards, and gifting for the family.
The future of Acorns includes more tiers, products, and benefits to help our customers continue growing.
Upon the completion of the deal, the combined company is expected to have a fully-diluted equity value on a pro forma basis of approximately $2.2 billion, assuming no redemptions. And following the transaction, the company will have significant capital flexibility for continued organic and inorganic growth. And existing Acorns equity holders, including management, will become the majority owners of the company.
The deal has been unanimously approved by the boards of both Acorns and Pioneer and is expected to close in the second half of 2021, subject to approval by Pioneer’s stockholders, the effectiveness of a registration statement to be filed with the Securities and Exchange Commission in connection with the transaction, and other customary closing conditions.
KEY QUOTES:
“I am humbled to represent everyday Americans in the global public markets. With the backing of trusted investors including BlackRock, PayPal, NBCUniversal and Comcast Ventures, we are putting the tools of wealth making in everyone’s hands and making it possible for everyday consumers to responsibly manage their money over the long-term. Going public will help elevate our story, introduce many more people to the power of compounding and financial wellness, and bring financial literacy to the mainstream.”
“Our loyal customers have gotten us here. They’ve earned a right to become owners alongside us, and help us grow together into the mighty oak that Acorns was meant to become. To that end, we intend to introduce our share rewards program that will allow eligible customers to own a piece of the company and an even greater piece as they invite others to start the path toward financial wellness.”
— Noah Kerner, CEO of Acorns
“Acorns is not only a category leader but also a category creator. Its value proposition is built around inclusive, long-term financial wellness. With integrity at its core, the brand has an incredibly loyal following and market leading retention rates. I could not be more excited to partner with Acorns.”
— Jonathan Christodoro, Chairman of Pioneer
Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.
