New York-based digital lender Better.com will be going public via a merger with special purpose acquisition company (SPAC) Aurora Acquisition Corp. nearly two years after Better’s initial timeline to IPO.
“At least 65% of the outstanding ordinary shares of the company entitled to vote at this meeting have voted in favor of (the) proposal,” Arnaud Massenet, CEO of Aurora Acquisition Corp, said in a shareholder’s meeting on Friday.
The transaction, once finalized, will infuse the combined entity with at least $550 million and up to $750 million in new capital, Aurora’s filing with the Securities and Exchange Commission (SEC) in July noted.
Better’s SPAC deal with Aurora had been extended three times amid unfavorable market conditions, mass layoffs, huge financial losses and a mountain of bad press.
Founded in 2014 by CEO Vishal Garg, Better has been making headlines for its layoffs since it gained notoriety by laying off about 900 employees over Zoom in December 2021.
The lender cut about 91% of its workforce over an 18-month period, Aurora’s filings with the SEC in July showed.
As of June 8, Better had about 950 team members, down from its peak of about 10,400 employees in Q4 2021.
Another controversy that didn’t help Better’s IPO was an SEC investigation over allegations Garg misled investors ahead of a planned SPAC merger. The SEC recently concluded it doesn’t intend to recommend an enforcement action against Better.
The digital lender posted a net loss of a net loss of $888.8 million in 2022 and $89.9 million in the first quarter of 2023, according to the SEC filing. Better funded 2,347 loans in Q1 2023, a decline of 87% compared to 18,559 loans funded in Q1 2022.
Better recently pivoted its real estate strategy, laying off its in-house brokerage subsidiary and partnering with outside agents.
Better ranked as the 59th largest mortgage lender in the country in the first quarter, according to Inside Mortgage Finance.
Aurora’s shares were trading at $37.03 on Friday morning after the vote, down 8.77% from the previous closing. Aurora’s share price skyrocketed 530% to $62.91 after the SEC declared the SPAC combination effective.
