Spanish banking giant BBVA is further increasing its stake in Durham, UK-based challenger bank Atom Bank as part of the company’s new £250m round.
The app-only bank has received £113m from BBVA, which is an existing backer in the company, as well as investment funds Toscafund and Woodford Investment Management.
The new round is expected to value Atom at £270m.
The investment follows news the company has inked a deal with rapper Will.i.am.
The will see the Black Eyed Peas-member act as a spokesperson and tech consultant to Atom with the option to acquire up to 3.55 million shares at a price of £1.15-per share over a the next three years.
The company will hold a shareholders meeting on Friday to approve its recent funding plan.
It’s also reported that the round is oversubscribed by its existing shareholders and that BBVA now owns more than 30% of the business.
This would push it to the threshold needed to trigger a mandatory offer for the remaining shares in Atom under UK law.
The startup is thought to have sought a waiver from the Takeover Panel and the approval of banking regulators to avoid having to sell.
Atom Bank says it has taken on more than £110m in deposits for its fixed rate savings accounts and will look to expand it mortgage offerings this year.
The investment news comes as rival challenger bank Monzo surpasses $7.5m in pre-registered investment for its $2.5m crowdfunding campaign.
It previously secured $19.5m from VCs including New York-based Thrive Capital.
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