Latitude welcomes Shinsei Bank as a 10% strategic investor
Latitude Financial today announced that Shinsei Bank had agreed to acquire a 10% interest in the company for A$300 million (subject to completion adjustments).
Shinsei will acquire the strategic stake from Latitude’s current equity owners KKR, Varde Partners and Deutsche Bank.
Shinsei began discussions with Latitude’s owners in 2020 about taking a strategic stake, attracted by the company’s strong financial performance, unique distribution model and growth prospects.
As part of the agreement, Latitude and Shinsei will form an alliance to explore mutually beneficial growth opportunities in the Asia Pacific region that leverage their respective strengths and capabilities.
Based in Japan and listed on the Tokyo Stock Exchange, Shinsei is a leading diversified financial institution, providing a wide range of services to businesses and consumers. Its international subsidiaries include UDC Finance in New Zealand, acquired from ANZ in 2020.
Under the commercial agreement, Shinsei has agreed to acquire a 9.95% stake in Latitude, followed by an additional 0.05% interest subject to FIRB approval.
Latitude’s Managing Director and CEO Ahmed Fahour welcomed Shinsei’s significant investment, saying it highlighted the strength of Latitude’s business model which leverages long-standing partnerships and connects major merchants with Latitude’s more than 2.7 million customers.
“Shinsei’s investment highlights the attention overseas investors are showing in Latitude as the leading provider of interest free shopping and consumer finance, offering customers a broader range of products that responsibly meet their needs,” he said.
“This substantial investment and strategic alliance will help accelerate our growth plans in Australia and New Zealand, particularly with interest free shopping and the boom in the home economy, while Shinsei’s expertise in financial services will assist with Latitude’s overseas expansion.”
Hideyuki Kudo, President and Chief Executive Officer of Shinsei, said: “We are delighted to invest in Latitude and excited by the opportunity to provide long-term support and value to a business that will deliver strong cashflow and profit growth.
“We were impressed by Latitude’s successful graduation model and ambition to build on its leadership in instalments and lending. We look forward to developing a partnership that will create new opportunities, leveraging both our strengths.”
Latitude Chairman Mike Tilley said Shinsei’s investment complements Latitude’s existing global ownership structure.
“The board looks forward to working closely with Shinsei and the existing investors as we enter an exciting new phase for our business,” he said.
“Latitude has emerged from 2020 in great shape. We continue to invest in the company’s digital transformation in support of our merchant partners, which include leading global and local brands, and to enhance the experience of customers.”
Latitude Financial is Australia and New Zealand’s leading provider of interest free shopping and consumer finance.
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