Investors in Chamath Palihapitiya's Social Capital Hedosophia Holdings V (IPOE +0.00%) finally got the news they've been waiting for on Tuesday. The merger of the special purpose acquisition company (SPAC) with personal financial services company Social Finance (known as SoFi) will go ahead as planned.
The business combination is expected to be completed on May 28. Social Capital Hedosophia Holdings V shares will then be exchanged one-for-one for SoFi shares and transferred to the Nasdaq exchange. Social Finance Technologies stock is scheduled to begin trading on Tuesday, June 1, using the ticker SOFI.
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The news comes just weeks after the company announced it had restated its financials to comply with a recent directive issued by the Securities and Exchange Commission regarding the accounting treatment of SPAC warrants -- which allow early investors to buy stock at a pre-determined price. There has been explosive growth in these deals over the past year, with many start-up companies bypassing the traditional initial public offering in favor of the SPAC merger. The SEC concluded that SPAC warrants should be listed as liabilities on the balance sheet, rather than being carried as equity, resulting in a waterfall of restatements.
SoFi boasts more than 1.8 million members and offers a host of personal financial services including individual loans, credit cards, home mortgages, student loans, and investing brokerage services. As part of its services, SoFi provides no-cost member benefits including financial planning.
The company made waves earlier this year when it announced plans to acquire Golden Pacific Bancorp, a move that will jump-start SoFi's banking ambitions while also expanding its product offerings.
