SimplyBiz acquires Defaqto in £74m deal

In a statement released this morning, SimplyBiz confirmed plans to acquire the entire issued share capital of Regulus Topco Limited, owner of Defaqto.

SimplyBiz will raise a total of £29.1m through share placing, approximately £37.5m of borrowings from new bank facilities and around £3.1m from its current cash resources to purchase the firm.

Defaqto currently operates a fintech platform for 8,500 advisers and provides independent ratings of 21,000 financial products and funds. It generated revenues of £12.8m in 2018.

The acquisition includes the purchase of £3.4m of cash on Defaqto's balance sheet at completion.

Neil Stevens and Matt Timmins, joint CEOs of The SimplyBiz Group, commented: "We are delighted to announce the successful acquisition of Defaqto, which will play an important role in building on the Group's strong momentum and enabling us to unlock a wide range of additional growth opportunities.

"The combination of the largest provider of outsourced regulatory and business support to the retail financial services market, with one of the leading providers of financial information and technology, will create a market leading platform across retail financial services. Collectively the two businesses will work to enhance our proposition to the banking and general insurance sectors whilst continuing to invest in the leading fintech platform.

"Having long respected the Defaqto management team, we also recognise not just the strong strategic fit of the business, but also its cultural alignment. Defaqto is a business built upon industry leading talent and we look forward to working with our new colleagues as we continue to enhance services to financial intermediaries and product providers, and deliver value for shareholders."

Zahid Bilgrami, CEO of Defaqto, added: "We are absolutely delighted with SimplyBiz's decision to acquire Defaqto. It opens an exciting new chapter in our development as a leading financial information business, and we look forward to the many opportunities that being part of a larger Group will present.

"While it will enable us to continue operating in an independent and autonomous manner, it will also carry many advantages of being a part of a listed entity. It will enable us to develop new technology faster, and thus continue to develop market-leading products for our clients at a time of vast technological change in the Financial Services sector."