Fox Corp. said it has closed its $265 million purchase of a majority stake in financial technology startup Credible Labs, which has been publicly traded in Australia.
The deal, which was announced last summer, will see Fox own 67% of the company, with a pledge of $75 million in additional financing for its future growth.
Credible, which was founded in 2012, offers online tools that allow borrowers to compare terms and options for loans.
In today’s announcement, Fox said Credible shares will be delisted from the Australian Stock Exchange on Friday. Under the deal, each Credible shareholder of record will get A$2.21 in cash, and each holder of common stock in Credible is entitled to A$55.25 per share.
Fox CEO Lachlan Murdoch said when the deal was first revealed that it “underscores Fox Corp.’s innovative digital strategy.” Fox is now a more focused and smaller-scale company after the $71.3 billion sale to Disney of two-thirds of its assets. Buying control of Credible, Murdoch, said, would unlock “tremendous synergy” between the startup and Fox Business Channel and the company’s local TV stations, Murdoch said.
Not everyone on Wall Street is persuaded by the logic, however. Michael Nathanson, a veteran media analyst with MoffettNathanson, rates Fox stock a “buy,” but questioned the Credible transaction in a note to clients. The deal “has not been seen as … well, credible,” he wrote, adding that it “rubbed investors the wrong way.”
Fox’s stock is about 25% below its level when it began trading in March following the Disney deal close. Shares began Thursday’s session at $31.80, down a fraction. The company will report financial results for its fiscal first quarter on November 6.
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