Digital homeownership platform Better is to receive $1.5bn in bridge financing from Aurora Acquisition and SoftBank, half of which is funded immediately, ahead of the company’s public listing.
In May this year, Better announced that it was going public via SPAC, following a merger agreement with Aurora Acquisition. This amended agreement provides Better with the immediate capital to fortify its balance sheet and grow its business.
The new agreement replaces the previous up to $1.78bn of financing from Aurora and SB Northstar LP (a fund managed by SB Management, a subsidiary of SoftBank Group) of which $950m of such financing proceeds would have been used to purchase shares from existing Better stockholders.
The $1.5bn transaction comprises a $750m bridge note funded immediately that converts into common equity at closing of Better’s merger with Aurora, and an additional commitment by Aurora’s sponsor and SoftBank to fund up to a $750m convertible note at Better’s option within 45 days after closing of Better’s merger with Aurora.
Founded in 2016, Better is a digital-first homeownership company whose services include mortgage, real estate, title, and homeowners insurance.
Vishal Garg, Better CEO, said, “This is exactly the time for us to lean in and accelerate our customer-focused product innovation, and grow our B2B business, which we believe provides us with greater defensibility in a tougher mortgage market. The incremental $750m of capital in the form of a commitment to fund a convertible note, on top of the $750m of cash coming immediately to the balance sheet, will help us to do exactly that.”
Better, Aurora, and SoftBank will work together toward public listing as soon as SEC registration and regulatory approvals are complete.
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