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(Bloomberg) – Goldman Sachs Group Inc. has agreed to buy GreenSky Inc. for approximately $ 2.24 billion, adding to its consumer banking platform Marcus a company that offers payment plans to customers with home improvement projects or health care needs.
The New York-based bank will pay 0.03 share of its common stock for each GreenSky share, which works out to about $ 12.11 per share, according to a statement released Wednesday. When Atlanta-based GreenSky went public in 2018, Goldman was a major underwriter of its initial offering at $ 23 a share. Today, Goldman buys the company today at about half that price.
In recent years, consumers, especially young people, have flocked to the buy-it-now and check-out programs offered by companies such as Afterpay Ltd. and Affirm Holdings Inc. Goldman is already working with Apple Inc. on a Buy It Now and Pay Later program. people familiar with the matter said in July. By buying GreenSky, the bank adds a fintech company that works with more than 10,000 merchants to provide payment options to their customers.
Goldman’s plan to grow its Marcus business is to attract new customers to its mobile app and core offerings such as unsecured loans and savings accounts. It also strives to have its services reside in other platforms and companies, like its credit card link with Apple. Buying GreenSky falls somewhere in between the two strategies, with Goldman directly acquiring customers by providing its services to merchants who offer them at the point of sale.
“We have been clear in our aspiration for Marcus to be the consumer banking platform of the future, and the acquisition of GreenSky advances that goal,” Goldman CEO David Solomon said in the statement. “GreenSky and his talented team have built an impressive cloud native platform that will allow Marcus to reach a new active set of merchants and customers. “
Shares of GreenSky climbed 52% to $ 11.81 at 9:37 a.m. in New York. Goldman slipped 0.8% to $ 400.50.
Banks are using GreenSky’s technology to extend loans to super-prime and privileged consumers, the statement said. It manages a $ 9 billion loan portfolio, and approximately 4 million customers have funded more than $ 30 billion in purchases using its technology since the founding of GreenSky by CEO David Zalik in 2006.
GreenSky stock had jumped nearly 70% this year through Tuesday. In July, the company reached an agreement with the Consumer Financial Protection Bureau to resolve an investigation into consumer complaints about unauthorized loans. GreenSky then agreed to pay $ 2.5 million and set aside an additional $ 9 million for loan cancellations and cash repairs for affected customers.
The boards of directors of Goldman and GreenSky have already approved the acquisition. The deal, subject to approval by GreenSky shareholders, is expected to close in the fourth quarter of this year or the first quarter of 2022.
(Updates with actions in the sixth paragraph.)
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