Acorns’ stock to take root after investing app OKs merger

NEW YORK (AP) — Acorns Grow, whose app encourages people to save and invest with subscriptions for as little as $1 per month, plans to soon have its own stock trading on the Nasdaq.

The financial technology company said Thursday that it will combine with Pioneer Merger, a so-called blank-check company whose stock trades on the Nasdaq but had no real business except for looking for another business to merge with. The deal values Acorns at about $2.2 billion and would allow its shares to trade on a public exchange without having to go through a traditional initial public offering, which can take more time and invite more scrutiny.

Acorns says it’s the largest subscription service in U.S. finance with more than four million subscribers, and that “from acorns, mighty oaks do grow.” The company’s $1 plan offers an investment account and helps people automatically steer their spare change from everyday purchases into ETF investments. Its higher-tier plans offer checking accounts, a “heavy metal debit card” and other services for $3 and $5 monthly subscriptions.

The combined company expects to trade under the ticker symbol “OAKS” after the deal closes, which may happen in the second half of the year.

Some big-name institutional investors are putting money into the company as part of the deal, including Wellington Management.

Pioneer Merger is a special-purpose acquisitions company, which are also known as SPACs. They were exploding in popularity early this year, as investors welcomed the possibility of getting their money into the next hot thing, but SPACs have slowed recently as the stock market has become volatile.

Still, SPACs have raised more than $104 billion already in 2021, up from less than $84 billion in all of last year and less than $14 billion in 2019.

The deal between Acorns and Pioneer has approvals from the boards of both companies, but it still needs an OK from Pioneer’s stockholders, among other things, before closing.

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