Why Park Cities Is Buying Elevate Credit (ELVT) For About $67 Million

By Amit Chowdhry ● Nov 17, 2022
  • Elevate Credit announced it has entered into a definitive agreement to be acquired by an affiliate of Park Cities Asset Management for about $67 million. This is why.

Elevate Credit, a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, announced it has entered into a definitive agreement to be acquired by an affiliate of Park Cities Asset Management LLC, an alternative asset manager focused on providing flexible debt solutions.

Park Cities is going to acquire Elevate for $1.87 per share in an all-cash transaction at an implied value of $67 million. And pursuant to the terms of the merger agreement, 7% of shares and shares underlying equity awards held by certain members of Elevate management are permitted to roll over into equity of the acquiring entity.

Launched in 2014, Elevate has reinvented non-prime credit with online solutions that provide financial relief today and help people build a brighter financial future. The company – along with the banks that license its technology – has originated more than $10 billion in credit to nearly 3 million non-prime consumers.

Park Cities brings decades of experience in consumer and commercial lending, extensive corporate finance acumen and significant operating experience that will allow Elevate to continue to serve credit-constrained Americans. And Park Cities has a long relationship with Elevate and currently provides corporate debt as well as financing for the Today Card product. Park Cities is also based in Texas and intends to maintain Elevate’s headquarters in Fort Worth, Texas.

The deal, which was approved by the Elevate Board of Directors by a unanimous vote of those voting, is expected to close in the first quarter of 2023, subject to customary closing conditions, including approval by Elevate shareholders and receipt of regulatory approvals. And upon completion of the transaction, Elevate’s shares will no longer trade on the New York Stock Exchange, and Elevate will become a private company. The company will continue to operate under the Elevate name and brand.

KEY QUOTES:

“From the beginning, Elevate has strived to be the most trusted and preferred alternative credit provider for the ‘New Middle Class’—the more than 100 million credit constrained Americans. I am excited to build on our partnership with Park Cities and continue our work as a leader and innovator in the non-prime market. I look forward to working with the Park Cities leadership team and believe the Company will greatly benefit from their expertise and comprehensive understanding of the credit landscape.”

— Jason Harvison, Chief Executive Officer of Elevate

“Elevate fills a massive void in the lending market, both through its suite of credit solutions and its powerful AI-driven technology platform. I am confident that we can help advance the Company’s vision while it maintains its commitment to serving the non-prime consumer.”

— Alex Dunev of Park Cities