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Bloomberg
Trading platform eToro, a rival to Robinhood Markets Inc., plans to go public via a merger with a blank-check firm led by serial deal-maker Betsy Cohen, according to people with knowledge of the matter.
The deal with FinTech Acquisition Corp. V will value the combined company at about $10 billion, the people said, asking not to be identified. The companies are raising about $650 million in equity to support the deal, which could be announced soon, they said.
The company became a member of the US Financial Industry Regulatory Authority Inc., or Finra, in the last year and is expected to start providing stock trading service in the US in 2021, the people said.
eToro has 20 million registered users in dozens of countries, according to its website. Founded in 2007, it expanded into the US in 2018.
Just like its rivals, it offers zero-commission trading. Unlike US firms, eToro doesn’t make money by selling its trading data to hedge funds in a business called payment-for-order flow, a practice that is prohibited in Europe. Instead, eToro primarily pockets a spread between the price its pays for securities and the price it passes along to customers.
It also brands itself as a “social trading†network, where investors can share their opinions and market exploits, and copy bets of best-performers on the system.
Fintech Acquisition Corp. V rose 40% in after-market trading. The stock closed up 1.7% to $10.71, giving the company a market value of about $366 million.
The special purpose acquisition company raised $250 million in December. Cohen, its chairman, has been involved with several blank-check companies, including one taking boutique investment bank Perella Weinberg Partners public.