NerdWallet to acquire On The Barrelhead in $120M deal

NerdWallet Inc. agreed to acquire On the Barrelhead Inc. for $120 million.

Under the terms of the deal, the total consideration consists of approximately $70 million in cash and $50 million in NerdWallet class A common shares. The equity issued as part of the deal will be determined based on the 30-trading day volume-weighted-average price, as of June 22, or $10.37 per share, and half of the equity will have a two-year lock-up restriction. NerdWallet expects to use borrowings from its existing credit facility to finance the cash portion of the acquisition.

A new compensatory bonus retention pool of approximately $30 million has been planned for On the Barrelhead management, according to a news release.

NerdWallet believes the acquisition of On the Barrelhead would have been accretive to NerdWallet's revenue and adjusted EBITDA for the year ended Dec. 31, 2021. NerdWallet also expects the acquisition to be accretive to its 2022 revenue and adjusted EBITDA.

The transaction is expected to be completed in the third quarter.

On the Barrelhead is a data-driven platform that offers credit-driven product recommendations to consumers and small and mid-sized businesses. For the 12 months ended Dec. 31, 2021, the company generated about $38 million in revenue, growing roughly 90% year over year, and $5 million in net income, the news release noted.

Solomon Partners was exclusive financial adviser to On the Barrelhead in the deal.