TIMIA Capital to acquire Pivot Financial for $6M to expand lending business
The acquisition, through which Pivot will stay a subsidiary, is meant to accelerate the SME lender's growth.
Vancouver’s TIMIA Capital Corporation has agreed to acquire the business of Pivot Financial, a private lender for small- and medium-sized businesses for $6 million in cash and shares. The combined company’s pro forma assets surpass $100 million, according to a statement from TIMIA.
Established in 2015, Pivot operates as a business lending alternative to the traditional banking sector, targeting companies with borrowing needs up to $10 million. The firm offers revolving lines of credit secured by receivables and/or inventory, factoring and purchase order financing, as well as complementary or standalone term loans or bridge loans secured by fixed assets. Interest rates range from 8-18% with terms between 6-24 months. The company has targeted industries including manufacturing, retail, service and distribution.
“TIMIA’s fintech-based loan origination and underwriting platform is complementary to the lending profile of Pivot Financial,” said Mike Walkinshaw, CEO of TIMIA. “TIMIA and Pivot service two distinct markets seeking growth capital with little or no overlap. As a result, this combination provides synergies from which we can each continue to build our portfolios while mutually leveraging our technology platform to drive efficiency and profit.”
TIMIA provides growth capital loans to recurring revenue technology businesses. Recent investments include Energy Watch, Myagi, Agentis, RocketRez and Surefire Local.
Pivot, which is operated by CEO Ken Thomson and president Dan Flaro, has grown to profitability since its 2015 founding. The TIMIA acquisition, in which Pivot will stay a subsidiary, is meant to accelerate its growth. “Pivot will continue to grow its SME lending business while leveraging TIMIA's automated lending system, advanced marketing operation, and our back office systems,” explained Walkinshaw.
As part of the deal, Thomson, will take on a senior leadership role with TIMIA Capital as chief strategy officer and join its board of directors and Flaro will continue in his leadership role with Pivot.
“Over the past 6 years, we have been successful at building our business by focusing on the borrowing needs of small to mid-sized Canadian enterprises with up to 100 employees and $50 million in revenue,” explained Thomson. “Joining TIMIA Capital provides access to a more diverse capital pool, a combined larger portfolio of assets under management, and a proven technology-based loan origination and management platform. Moving forward we will leverage the strengths of each company with a goal of becoming a leading specialty lending company in North America.”
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