Mogo, the digital payments and financial tech company could potentially become a majority shareholder in the Coinsquare exchange. This was after the company announced that it intends to increase its stake in the Canadian crypto exchange. Since it was established in 2014, Coinsquare has grown to become the largest crypto exchange in Canada. It continues to experience growth in revenue, assets, and profitability.
Details Of The Purchase
Mogo revealed that it would purchase 2.0% of the outstanding common shares on Coinsquare from Michael Diamond and affiliate companies. Additionally, Mogo will retain the option to buy a further 3.4% of the remaining Coinsquare Shares from affiliated companies within 120 days. The option to purchase these extra shares will be done under similar terms, but subject to detain conditions. On May 13, 2021, Mogo announced that it had bought an additional 5.4 million Coinsquare Shares. If the company were to exercise its full rights to buy shares in the crypto exchange, its total stake would be around 53%.
The share acquisition is being done in line with a binding term sheet that was entered by Mogo and affiliated companies on May 31, 2021. All purchases are expected to be concluded by mid-June 2021. However, the purchase is subject to several standard conditions with a purchase of this nature.
One of the conditions is regulatory approval by the Toronto Stock Exchange.
According to Greg Fell, the President of Mogo, Coinsquare was a highly valuable asset in Canada’s fintech ecosystem. He noted that the exchange had been doing quite well with rapid growth in EBITDA and revenue in 2021. He noted that in April 2021, the company generated a record monthly revenue of $8.0 million. Fell added that May’s revenue numbers were expected to be higher. The president noted that:
“In addition to the financial merits of our investment, this is a great fit strategically and supports our objectives to build the most comprehensive digital wallet in Canada, including a range of investing and saving options and a free stock trading solution. By leveraging Coinsquare’s leading crypto capabilities, along with Mogo’s leading digital wallet capabilities, we are well-positioned to execute on our growth plans.”
Coinsquare was founded in 2014. It offers digital assets traders an efficient trading platform where they can trade Ethereum, Bitcoin, Litecoin, and other cryptocurrencies. They also offer additional services such as Coinsquare Wealth, which is designed for qualified institutions and individual investors. The Coinsquare platform offers a sleek UX that seems to be a magnet for the millennial generation. In recent news, the platform rolled out their “quick trade app” that powers seamless trading.
✅ Instant deposits with Interac e-Transfer
✅ Speedy withdrawals with Interac e-Transfer
✅ No-fee deposits/withdrawals
✅ No commission fees on trades pic.twitter.com/laQeN7fqkJ
— Coinsquare (@Coinsquare) February 8, 2021
Mogo is the firm behind the Mogo app, which has over one million members. It empowers members with simple digital solutions to help them manage their financial health. Via the app, users can easily buy and sell Bitcoin, access free monthly credit score monitoring, personal loans, and ID fraud protection. Additionally, their wholly-owned subsidiary, Carta Worldwide, allows users to access a digital payments platform, which powers next-gen card programs from innovative fintech in North America, Europe, and APAC.
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