Greensill to challenge Citi with $1.15b boost from Softbank
Rich Lister Lex Greensill says a $1.15 billion equity injection from Softbank, the largest-ever venture capital investment in an Australian private company, will help him leapfrog Citi to become leader in the $80 trillion global working capital finance market.
The $US800 million ($1.15 billion) investment into Greensill Capital from the Japanese bank’s Vision Fund, major backer of global disruptors Uber and Alibaba, is understood to have valued the financier at just over $5 billion.
That is the same size as Bendigo Bank, and 50 per cent larger than Bank Of Queensland – examples of the traditional lenders Mr Greensill says generally have failed to provide working capital finance to small-to-medium enterprises and forcing them into more-expensive invoice financing.
Greensill uses data-driven insights to sit between suppliers and their larger debtors, paying suppliers on time and in full – bar a fee and an interest rate that the founder says is lower than bank rates. This compares with the 10 to 20 per cent a borrower would give up on a typical invoice factoring transaction.
The financier funds its activities through a German bank it owns, giving institutional investors a 2-3 per cent return on funds lent to it for its working-capital finance activities.
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