The UK’s two biggest crowdfunding platforms have announced plans to merge.
Crowdcube and Seedrs said in a joint statement on Monday they had agreed the terms of a merger. The combined company will be worth £140m ($181.2m).
Crowdcube will acquire Seedrs under the terms, with Crowdcube’s shareholders owning 60% of the combined business. Seedrs investors will receive 40%, reflecting the differing valuations of the two companies. Crowdcube was last valued at £84m and Seedrs is worth £56m. The exact financial terms weren’t disclosed.
“Today’s agreement is an incredibly exciting milestone that will benefit high growth businesses, their investors who believe in their vision and the wider entrepreneurial ecosystem that supports them,” said Darren Westlake, Crowdcube’s founder and chief executive.
“Together with Seedrs, we can accelerate plans to further expand in the UK and overseas, launch innovative new products and improve our customers’ experience.”
Westlake will serve as executive chairman of the combined business. Seedrs chief executive Jeff Kelisky will serve as CEO.
“We believe that you need to be a player of greater scale to serve companies and the investors who support them,” Kelisky said in a statement. “Now is the right time to bring our strengths together, in order to meet our common mission to deliver a step change in the accessibility and efficiency within private company investing.”
The merger is subject to approval by shareholders in both companies, the UK’s Competition and Markets Authority, and the Financial Conduct Authority. The deal is expected to close either at the end of this year or early in 2021.