Payoneer Agrees to a SPAC Merger That Will Take the Company Public

Global e-commerce payments provider Payoneer Inc. announced Wednesday morning it will go public via a merger with a blank-check company, confirming reports about a deal that first emerged last month.

In the merger, which values Payoneer at $3.3 billion, the 15-year-old, New York City-based firm becomes the eighth payments-related company since 2016 to choose this route to public ownership. The buyer is a special purpose acquisition company, or SPAC, called FTAC Olympus Acquisition Corp. FTAC is headed by Betsy Cohen, founder and former chief executive of The Bancorp Bank.

Payoneer specializes in working with marketplaces like Amazon and Alibaba to enable payments for sellers. Its model is attractive to investors because it allows the company to collect transaction fees from sellers both when they receive payments and when they make payments.

That model has helped spark high growth for Payoneer. It reported $44 billion in payment volume for 2020, up 52% over 2019, and it projects $64 billion for this year. “It’s a pretty good growth story. They’ve been under the radar,” says Eric Grover, principal at payments consultancy Intrepid Ventures, based in Minden, Nev., though he points out that Payoneer is also up against some heavy-duty competitors like Stripe, Adyen, and Chase.

Indications that Payoneer was angling to go public via a SPAC merger began surfacing in January, when Bloomberg News reported talks had already started. By that time, a string of payments companies, including Paysafe Group  and Paya Inc., had already used SPAC vehicles in preference to a conventional public offering.

With a blank-check deal, a SPAC raises funds via an initial public offering and then hunts for acquisitions. The entity has two years to suss out likely targets and make a deal. The acquired company for its part views the deal as a streamlined means of going public compared to an IPO of its own. FTAC has a history of targeting payments players. It is the successor to a series of SPACs that resulted in public ownership in recent years for the independent sales organization CardConnect in 2016 and Paya last year. CardConnect in 2017 was acquired by First Data Corp., which in turn was swallowed in 2019 by Fiserv Inc.