(Bloomberg) – Goldman Sachs Group Inc. agreed to buy GreenSky Inc. for about $ 2.242 billion, adding to its Marcus consumer banking platform a company that offers payment plans to customers with home improvement projects or health needs.
The New York-based bank will pay 0.03 shares of its common stock for each GreenSky share, which is estimated at about $ 12.11 per share, according to a statement Wednesday. When Atlanta-based GreenSky went public in 2018, Goldman was one of the top subscribers to its initial offering at $ 23 per share. Now Goldman buys the company today at half that price.
Consumers, especially younger ones, have flocked in recent years to buy pay-as-you-go programs offered by companies like Afterpay Ltd. and Affirm Holdings Inc. Goldman is already working with Apple Inc. in a post-payment purchase program, people with knowledge of the issue said in July. By purchasing GreenSky, the bank adds a fintech technology company that works with more than 10,000 merchants to offer payment options to its customers.
Goldman’s plan to expand its Marcus business includes attracting new customers to its mobile app and its core offerings, such as unsecured loans and savings accounts. It also makes a push for its services to reside on other platforms and businesses, similar to its credit card link with Apple. Buying GreenSky lies between the two strategies, Goldman acquires customers directly by providing its services to merchants who offer them at the point of sale.
“We have been clear in our aspiration for Marcus to become the consumer banking platform of the future and the acquisition of GreenSky is advancing that goal,” Goldman CEO David Solomon said in the statement. “GreenSky and its talented team have built an impressive cloud-native platform that will allow Marcus to reach an active and new set of merchants and customers.”
Shares of GreenSky soared 52% to $ 11.81 at 9:37 a.m. in New York. Goldman fell 0.8% to $ 400.50.
Banks use GreenSky technology to provide loans to super-prime and prime consumers, according to the statement. It offers a $ 9 billion loan portfolio and nearly 4 million customers have funded more than $ 30 billion in purchases through its technology since GreenSky was founded by CEO David Zalik in 2006.
Shares of GreenSky had risen nearly 70% this year to Tuesday. In July, the company reached an agreement with the Office of Consumer Financial Protection to resolve an investigation into consumer complaints about unauthorized loans. At the time, GreenSky had agreed to pay $ 2.5 million and allocate an additional $ 9 million for loan cancellations and cash repairs for affected customers.
Goldman and GreenSky’s boards have already approved the acquisition. The deal, subject to GreenSky shareholder approval, is expected to end in the fourth quarter of this year or the first quarter of 2022.
(Updates with actions in the sixth paragraph.)
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