“LendCare is a complementary fit for goeasy, helping advance and propel our existing growth strategy.”
– Jason Mullins, goeasy
The deal consists of cash and $10 million in common shares. LendCare founders Ali Metel and Mark Schell will assume management positions at goeasy, while maintaining responsibility for LendCare’s ongoing operations.
The acquisition is being funded in part by a bought deal equity agreement with BMO Capital Markets totalling $130 million. The deal is expected to close in the second quarter of 2021.
Through the deal, goeasy aims to accelerate its growth strategy in the consumer credit market by growing its product range and POS distribution platform.
“We have achieved incredible growth over the past 15 years and this acquisition will serve to accelerate LendCare’s current growth strategy as goeasy looks to make meaningful investments in the business,” said Ali Metel, LendCare’s president and CEO. “Together, we will help bring our customers and merchants an even better suite of products and financing experience.”
goeasy, which is also headquartered in Toronto, operates two core businesses: easyfinancial, which offers high-interest loans to subprime borrowers (meaning Canadians with poor credit), and easyhome, which sells furniture and other goods on a rent-to-own basis. The company also offers unsecured and secured installment loans and consumer leases.
The company has been relatively active in the financial space in recent years. In 2019, goeasy invested $34 million into Toronto-based PayBright, another buy-now-pay-later provider. In December, US-based Affirm acquired PayBright for $340 million.
Founded in 2004, LendCare specializes in financing consumer purchases in the power sports, automotive, retail, healthcare, and home improvement verticals. goeasy claims LendCare has processed over $6 billion in loan applications and serves approximately 3,000 businesses in Canada, including merchants, OEMs, and distributors.
“LendCare is a complementary fit for goeasy, helping advance and propel our existing growth strategy, by expanding our range of financial products and growing our point-of-sale lending channel,” said Jason Mullins, goeasy’s president and CEO.
With files from Josh Scott.
Image source Unsplash. Photo by Emil Kalibradov.