China has one of the most dynamic Fintech markets in the world, thanks to the size of the market for digital payments, money transfers, crowdfunding, lending and more. In terms of the numbers, the Fintech market in China reached as high as US$25.5 billion as recently as 2018, ranking first in the world and accounting for over half of global fintech investments.
Enters
Peak Fintech Group (
CSE: PKK,
OTCQX:PKKFF,
Forum), which is one such company dominating the space thanks to its six subsidiaries operating in China’s commercial lending industry.
The company’s subsidiaries use technology, analytics, and artificial intelligence to create an ecosystem of lenders, borrowers, and other participants in the country’s commercial lending space where operations are done safely, efficiently and with transparency.
After several years of operating exclusively in China, Peak Fintech Group is stretching its arms and broadening its horizons into the North American fintech market, which is expected to reach $110 billion by 2026 catapulted by banks and organizations investing in technology solutions that will boost security for financial transactions.
As such, Peak Fintech Group
announced on August 16 that it will be acquiring Cubeler, an analytics and AI company located in the heart of Montreal.
Peak Fintech to acquire Cubeler
In a press release, it was revealed that Peak Fintech will acquire 100 per cent of all the issued and outstanding shares of Cubeler, which is a company that has developed and owns the world-wide commercial rights to the technology at the core of Peak’s Business Hub.
Thanks to its business development ecosystem, Cubeler can provide its members with funding and credit offers from banks and similar lending institutions. Other services it provides include the ability to connect and network with business owners, timely market intelligence data on a range of industries as well as advertising opportunities.
The acquisition of Cubeler involves Peak acquiring it from Cubeler’s shareholders in exchange for $1 million in cash and over 11.13 million shares of Peak, which represents roughly 10 per cent of Peak’s issued and outstanding common shares on a fully-diluted basis once the transaction in closed.
Johnson Joseph, CEO of Peak Fintech, said the acquisition of Cubeler marks a vital moment in the company’s history.
"It not only gives us complete autonomy on the technology responsible for generating 90% of our revenue, but just as important, allows us to begin the next phase of our vision for the Business Hub, which is to create a global ecosystem of businesses and financial institutions where analytics and AI are used to conduct business more efficiently,” he said.
While Cubeler hasn’t launched its ecosystem yet in Canada, Joseph said businesses across several provinces have already pre-registered for the platform.
“Our goal is to take elements from our operations in China, such as our ability to control the flow of funds to help our members get paid faster and integrate this operational model within Cubeler's ecosystem to create a North American Business Hub that provides members with the best of both worlds when we officially launch our North American operations later this year,” Joseph added.
The company said it will also implement elements from Cubeler’s current ecosystem to Peak Fintech’s Business Hub in China to generate new revenue streams from its Chinese operations.
Shares of Peak Fintech that Cubeler shareholders will receive will first be restricted by a four-month period after which 50 per cent will be released and become free-trading over a two-year period on the anniversary of the acquisition date. Peak Fintech’s acquisition of Cubeler is expected to close by September 30, 2021.
Peak Fintech in the news
The Cubeler acquisition news is another one of a series of multiple important milestones Peak Fintech has been hitting recently. At
the end of July the company announced it had acquired a minority stake in China UnionPay subsidiary, Rongbang Technology, after previously signing an announcement with Rongbang that allows Peak Fintech to use the China UnionPay network.
Just prior to that,
the company began the acquisition process of banking AI software provider Zhongke Software Intelligence. Peak Fintech first announced its intentions to acquire Zhongke in December 2020.
The investment opportunity
Peak Fintech has solidified itself as a dominant force in the Chinese fintech market and is now ready to conquer the North American market.
Investors are taking notice. Already, shares of Peak Fintech have risen over 173 per cent year to date, with a significant bump coming at the end of July and early August after several key announcements that garnered investor attention.
As the company looks to continue its dominance in China and expanding its footprint across North America and beyond through key acquisitions and partnerships, Peak Fintech is the company to watch for the long haul.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.