Singapore-based iFast Corporation, a wealth management company, is looking to acquire an 85 percent stake in the United Kingdom-licensed BFC Bank for £40 million, a regulatory filing on Friday revealed.
iFast has already entered into an agreement with partner Eagles Peak to acquire the stakes in the platform from its Bahrain parent BFC Group. Eagles Peak was incorporated in 2020 for the sole purpose of acquiring the BFC Bank. If the deal goes through, iFast will hold an 85 percent stake in Eagles Peak, while the remaining 15 percent will be held by MMSS Investments, the current sole owner.
Out of the total proceeds, £22.6 million will be used to fund the acquisition , while another £15 million will be injected as capital into the bank. The remaining £2.4 million of the proceeds will be utilized to offset the transaction costs.
The proposed acquisition deal now requires approval from the Prudential Regulation Authority and the Financial Conduct Authority in the UK, along with the shareholders of the companies.
Long Term Plans
BFC is a fully licensed bank in the United Kingdom and is operating under the Financial Services Compensation Scheme. Its acquisition will help the Singaporean fintech to expand its reach in the lucrative British market.
The deal was inked as a part of iFast’s extended 5-year plan for global expansion. It is expected to help the company acquire more banking customers at a faster pace.
“While the group has made substantial progress as a wealth management platform without some of the key advantages that the banks have, a lot more can be achieved if there is a bank within the group,” iFast noted in the regulatory filing.
Despite the long-term promises, iFast is expecting initial losses in 2022 and 2023 as BFC Bank posted a net loss of £2.2 million in the first nine months of 2021.
