Raiz Invest Limited and State Street Global Advisors (SSGA) have entered into an equity investment agreement, under which SSGA will acquire some 5 per cent of Raiz’s share capital through a placement.
In its FY2023–24 results posted on Monday, Raiz confirmed State Street will acquire 4.8 per cent of its issued ordinary shares at 41 cents per share through a placement, representing a 9.3 per cent premium to the last close price on Thursday, 22 August.
Raiz said it would also undertake a share purchase plan (SPP) to raise up to $2 million.
“Funds raised under the placement and SPP will be used for strategic opportunities including the build out of a bespoke artificial intelligence language model, product innovation and potential future merger and acquisition opportunities,” Raiz said.
According to State Street, the partnership will see its brand and market knowledge come together with Raiz’s mobile-first platform, which helps Australian investors with micro-investments primarily in exchange-traded funds (ETF) and model portfolios.
Namely, Raiz customers will have access to a broader array of financial literacy content and investment education tools via SSGA’s international library of resources, insights, and trends.
“We are excited to expand our relationship with Raiz, a proven fintech leader in bringing important tools and educational resources to investors across the region,” said Yie-Hsin Hung, president and chief executive of SSGA.
“This strategic investment reinforces our strategy to join forces with wealth firms who share our commitment to help investors globally manage their investments and savings for retirement,” Hung said.
SSGA head of intermediary for Asia-Pacific, Meaghan Victor, added that deepening its existing relationship with Raiz reinforces SSGA’s commitment to the Australian market.
“This investment is a natural extension of the successful relationship we have enjoyed with Raiz since launch in 2016. Both of us share a passion for making financial tools and solutions accessible to all investors, and through this strategic arrangement, we will leverage our respective capabilities to help Australian investors plan and save for retirement,” Victor said.
Moreover, Raiz managing director and chief executive Brendan Malone noted that the fintech’s local customers, who range from beginners to experienced investors, will benefit from the global resources that can be provided through the partnership.
“Between Raiz’s technology and State Street Global Advisors’ global investment capabilities and markets expertise, there are great opportunities for innovation in the Raiz product offering,” Malone said.
“From learning about investments in ETFs through to more complex investment strategies such as superannuation retirement portfolios, we look forward to continuing our relationship with State Street Global Advisors on educational tools for all stages of a customer life cycle.”
