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Finally good news for the embattled fintech as Softbank and Revolut agreed to simplify the ownership structure between the UK fintech and its largest investor.
Revolut agrees deal with SoftBank
This was, according to reports, the final barrier faced by Revolut to win its long-delayed banking licence in the UK.
The two companies have been at loggerheads for months of negotiations — internally codenamed “Project Swan” — with SoftBank demanding stiff compensation for giving up its priority class of shares.
The Bank of England has made collapsing Revolut’s six classes of shares — the legacy of multiple funding rounds since it was founded in 2015 — one condition for granting a UK banking licence, which Revolut first applied for more than two-and-a-half years ago.
The BoE’s regulatory arm is the lead agency for approving banking licence applications, which must also be signed off by the Financial Conduct Authority.
The agreement in principle struck last week does not include any new issuance of “top-up” shares for SoftBank, nor will it have a financial impact on the company.
According to reports, SoftBank initially demanding as much as twice the amount of common stock in exchange for giving up some of the preferential rights it received for leading a 2021 fundraising round, which made Revolut the UK’s most valuable private tech company.
Other investors — including Tiger Global Management, venture capital firm TCV, Balderton Capital and Ribbit Capital — have all either agreed to transfer their shares into a single class, or are in final talks to do so.
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