Latest News
BankMobile Technologies to Combine with Megalith Financial in Deal Valued at USD 140m
Monday 10 August 2020

New York-based digital banking platform BankMobile Technologies has entered into a merger agreement with special purpose acquisition company Megalith Financial acquisition Corp (NYSE: MFAC), to operate as BM Technologies Inc., the company said.

BankMobile Technologies is a subsidiary of Customers Bank (NYSE: CUBI).

The transaction reflects an enterprise value for the company of USD 140m. Customers Bank is to receive approximately USD 97m in consideration comprised of cash, stock in the company, and approximately USD 10m in value attributed to a new technology license with BMT.

Customers Bank may be repaid a portion of the USD 40m debt owed to it by BMT with the new company assuming any unpaid debt.

The cash component of the consideration will be funded by a portion of MFAC's cash in trust as well as a private placement from institutional investors and MFAC's sponsor that will close concurrently with the closing of the business combination, in addition to BankMobile's cash on its balance sheet in excess of an agreed upon cash reserve.

The balance of the consideration will consist of shares of common stock in the combined company, each to be valued at USD 10.38 per share.

Customers Bank is expected to remain the largest investor in the company by rolling over significant equity into the combined company.

Upon the closing of the transaction, BM Technologies will be a financial technology company bringing banks and business partners together through its digital banking platform.

The transaction is structured as a forward subsidiary merger, whereby BankMobile will merge with a newly-formed subsidiary of MFAC, with MFAC's merger subsidiary continuing as the surviving entity and a wholly-owned subsidiary of MFAC. At the closing of the transaction, MFAC will change its name to BM Technologies.

Raymond James is acting as financial advisor to BankMobile and Customers Bank. Nelson Mullins Riley and Scarborough and Stradley Ronon Stevens and Young, LLP are acting as legal counsel to Customers Bank.

Boenning and Scattergood is acting as financial advisor to Customers Bancorp's special committee and provided a fairness opinion for the transaction to the special committee. Duane Morris LLP is acting as independent counsel to Customers Bancorp's special committee.

Keefe, Bruyette, and Woods, a Stifel company, is acting as financial advisor and capital markets advisor to MFAC. Chardan is also acting as a capital markets advisor to MFAC.

Ellenoff Grossman and Schole is acting as legal counsel to MFAC. Vantage Point Advisors is acting as a financial advisor to MFAC's special committee and provided a fairness opinion for the transaction to the special committee.
Details
Date Published: 10/08/2020

Options