Nu Holdings Weighs $13B Monzo Buyout, Shares Slide 5.8%
NU is trading near its 52-week low of $11.2 (12% above the low) on light trading volume (0.4× avg).
Summary
Nu Holdings is reportedly in talks to acquire UK neobank Monzo in a deal that could value Monzo at up to $13 billion, funded through cash and shares. The news sent Nu shares down 5.8% to $12.80 as investors worry about dilution and near-term earnings pressure from the company's largest-ever acquisition. The FT reports Nu may instead take a minority stake, and Monzo is being advised by Morgan Stanley and Qatalyst. This follows Nu's recent expansion into the US and its strong Q2 results, but the market is reacting negatively to the potential size and execution risk. Watch for confirmation or denial from either company, which could swing the stock sharply.
At the time of this announcement, NU was trading at $12.58 on NYSE in the Finance sector, with a market capitalization of approximately $60.8B. The 52-week trading range was $11.20 to $18.98. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: Benzinga.