PE-backed CompareAsiaGroup merges with US-listed SPAC
CompareAsiaGroup, an Asia-focused financial products comparison platform also known as MoneyHero Group, has agreed to merge with a US-listed special purpose acquisition company (SPAC) at an enterprise value of approximately USD 342m.
Founded in 2014, CompareAsiaGroup has received five rounds of funding amounting to more than USD 160m, according to AVCJ Research. Nova Founders Capital and Stem Capital were the earliest investors in 2014, providing USD 6m. This was followed by a Series A of USD 40m in 2015 and a Series B of USD 50m in 2017, led by Goldman Sachs and the International Finance Corporation (IFC), respectively.
Data and financial services company Experian led a USD 20m round in 2019, which was billed as an extension to the Series B. Around the same time, insurer FWD acquired a 25% held by Nova Founders Capital for USD 48.5m. This transaction valued CompareAsiaGroup at USD 194m.
Other investors in the company include ACE & Company, Gobi Partners, H&Q Asia Pacific, Route 66 Ventures, Jardine Pacific, and SBI Holdings. Hong Kong telecom operator PCCW is also identified as an investor but it’s unclear when the company backed CompareAsiaGroup.
The company is merging with Bridgetown Holdings, the first of three SPACs raised by Peter Thiel, PineBridge Investments, and Pacific Century Group to target new economy assets in Southeast Asia. Bridgetown Holdings, which secured USD 550m from investors in September 2020, was previously linked to e-commerce start-up Tokopedia and tourism player Traveloka.
Pacific Century and PineBridge are both controlled by Richard Li, son of Hong Kong billionaire Li Ka-shing. FWD and PCCW are controlled by Pacific Century. They and other existing investors will roll over 100% of their equity into the merged entity.
Further details on the percentage ownership accruing to each party post-transaction were not disclosed. A filing said that the merged entity will receive USD 154m in cash held in trust by the SPAC. The final amount will be dictated by how many SPAC shareholders elect to redeem their shares for cash on completion of the deal instead of exercising their warrants and purchasing shares.
CompareAsiaGroup operates in Singapore, Hong Kong, Taiwan, the Philippines and Malaysia through brands such as CompareHero, Creatory, MoneyHero, Moneymax, Money101, Seedly, and SingSaver. It claims to have 270 commercial partners and 9.8m monthly unique users.
The business has two pillars: online financial comparison platforms focused on products such as credit cards, personal loans, mortgages, and insurance; and a B2B operation – Creatory – that provides digital technology solutions to third-party online channel partners and content creators, enabling them to monetise their user bases. Comparison platforms are responsible for more than 80% of revenue.
CompareAsiaGroup generated USD 68m in revenue last year – two-thirds of which came from Hong Kong and Singapore – up from USD 62m in 2021 and USD 16m in 2018. Average monthly unique users rose from 5.1m in 2018 to 6.2m in 2021, and 7.8m in 2022, while product applications increased more than threefold over the same period.
The only profitability metric mentioned in an investor presentation is adjusted EBITDA. The company’s loss widened from USD 11.7m in 2021 to USD 15.8m in 2022, but there was a meaningful drop in the second half of last year following a company-wide reorganisation and the implementation of what is described as an efficient operating and management model.
“MoneyHero is empowering financial service providers in the Greater Southeast Asia region to transform the way they connect with consumers—and consumers in turn are benefiting from a trusted and transparent online platform offering access to a wide variety of financial products,” said Matt Danzeisen, chairman of Bridgetown, in a statement.
“This business model promises significant growth potential given the demographic evolution across Greater Southeast Asia. With continued strong leadership by the management team and fresh funding from this transaction, we believe MoneyHero is poised to penetrate deeper in the Greater Southeast Asia market and to become a household online platform for retail financial offerings in the region.”
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