Pagaya Reports Oversubscribed PIPE of $350 Million as Part of SPAC Deal

As part of a previously announced $8.5 billion SPAC deal with EJF Acquisition Corp. (NASDAQ: EJFA, EJFAU, EJFAW), Pagaya is reporting an “upsized” PIPE of $350 million – an equity offering that was said to be oversubscribed. The PIPE was increased by $150 million from the prior $200 million.

Pagaya said the investment is indicative of the strength of Pagaya’s strategy to penetrate regional/large banks and auto lenders and expand into new markets.

Pagaya is a Fintech that wants to “reshape the lending marketplace through machine learning, big data analytics, and sophisticated AI-driven technology.”

In a release, Manny Friedman, Chairman, EJF Acquisition Corp., said that Pagaya is at the forefront of Fintech innovation:

“The support of this distinguished investor group is a vote of confidence in the company’s strategy to penetrate what is a substantial addressable market, including banking, consumer lending, credit cards and point-of-sale financing.  The additional $220 million of new committed capital represents a cornerstone investment by a premier group of long-term investors, including Tiger Global, Whale Rock, GIC – Singapore’s Sovereign Wealth Fund, Healthcare of Ontario Pension Plan (HOOPP) and G Squared. To accommodate the significant demand, funds affiliated with EJF Capital LLC reduced a portion of their allocation.”

Gal Krubiner, co-founder and CEO of Pagaya, said they are humbled by the support of investors that share their vision:

“As we enter 2022 focused on the continued adoption of our technology by additional large banks and auto lenders, this incremental funding reflects an enormous vote of confidence in our strategy and our team.”

Scott Shleifer, Partner at Tiger Global, described Pagaya as “one of the most attractive growth opportunities that we’ve encountered in technology investing.”

Pagaya noted that as previously announced, Leslie Gillin, former Chief Marketing Officer of JP Morgan Chase and President of Chase Co-Brand Card, joined Pagaya as Chief Growth Officer.

In November Pagaya announced third quarter 2021 performance with $137 million in Q3 2021 revenue and $320 million in revenue year-to-date through Q3 2021, 220% higher than full-year 2020 revenue.

The SPAC deal also includes approximately $287.5 million in gross proceeds from EJFA’s cash in trust (assuming no redemptions) and $350 million in gross proceeds from the PIPE.

The business combination is expected to close in early 2022.

 

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