Time Running Out on FinTech Acquisition Corp.

  • JJ Hornblass
  • February 19, 2016
  • 2

canstockphoto3509442The clock is ticking on FinTech Acquisition Corp.

FinTech Acquisition Corp, believed to be the only “blank check” company in the fintech sector today, has by rule until Aug. 19 to consummate an acquisition with its $100 million, or face dissolution. A “blank check” company’s sole purpose is to make an acquisition with the money its investors have given it.

FinTech Acquisition Corp, which today issued its 10-K for the fourth quarter of 2015, was founded in November of 2013. It went public last April [ticker: FNTCU].

With each passing day, the likelihood that FinTech Acquisition will finalize the purchase of a company dwindles. Six months is not a lot of time to consummate a deal with these parameters, as specified by the company:

We will seek to acquire one or more businesses with annual revenues of approximately $50 million to $250 million and an enterprise value of approximately $200 million to $800 million.

That means FinTech Acquisition is planning to supplement its $100 million with financing.

Just who is behind FinTech Acquisition? Ex-The Bancorp Inc. executives, it turns out. Specifically, the principals of the venture are Betsy Z. Cohen, the founder of The Bancorp and its former chief executive officer, and her son, Daniel G. Cohen, also listed as a founder of The Bancorp, which, in part, provides banking services to fintech companies.

In the face of regulatory difficulties, The Bancorp’s stock [ticker: TBBK] has lost 58% of its value since Betsy Z. Cohen retired as CEO at the end of 2014.

The “blank check” company has a narrow focus for companies it would consider acquiring. Here’s how the company describes it:

We have concentrated and intend to continue concentrating our efforts in identifying businesses which provide disruptive technological innovation to the financial services industry, with particular emphasis on businesses that provide data processing; transactional and data security; rewards, loyalty, and consumer engagement platforms by which financial services engage their clients and market and provide services to them; digital marketing; and payment processing services.

FinTech Acquisition Corp is “not, however, required to complete our initial business combination with a financial technology business and, as a result, we may pursue a business combination outside of that industry.” With each passing day, that might become a more likely option.

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JJ started the first iteration of Bank Innovation back in 2007, and has been working on it ever since. He also serves as President & Chief Executive Officer of Royal Media, Bank Innovation’s parent. He founded Royal in 1995 and oversees all aspects of the New York-based diversified media company. Prior to forming Royal, JJ was on the editorial staff of American Banker, the daily newspaper, and worked as an editor of a business magazine in Hong Kong. As a reporter and editor, he has won journalism awards from the National Press Foundation, Newsletter & Electronic Publishers Foundation, and the Reader’s Digest Foundation. He has a BS in Economics from Yeshiva University and a Master’s from the Columbia University Graduate School of Journalism. He was also a Fellow at the University of Wisconsin-Madison Graduate School of Banking. He lives in New York City with his wife, two daughters, and son. He counts among his accomplishments one New York City Marathon, two New York City Triathlons and the 2010 Father’s Day 5K, the first race he ever ran with his daughters. He can be reached at hornblass@gmail.com or 212-564-8972.

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