Intuit Closes Multibillion-Dollar Deal For Credit Karma
The company said on Thursday (Dec. 3) that it has completed its $8.1 billion acquisition of Credit Karma, which offers credit scores and reports to consumers and counts 110 million “members.” Intuit first announced its plans to buy Credit Karma in February, with an eye toward helping TurboTax, one of its flagship products, push deeper into consumer finance.
However, the prospect of a deal that would unite TurboTax, a powerhouse in the tax preparation business, with Credit Karma’s own sizable consumer tax business, drew antitrust concerns from federal regulators.
The U.S. Justice Department gave the deal a green light last month on the condition that Credit Karma sells its tax business, with Square Inc. having stepped up to buy the unit. Intuit paid “approximately $3.4 billion in cash and 13.3 million shares of Intuit stock and equity awards with a value of $4.7 billion” to acquire Credit Karma, the companies said in a press release.
That number includes “approximately $300 million of acquired cash.” In addition, Intuit said it will also “grant approximately $300 million of restricted stock units to Credit Karma employees shortly after the closing of the transaction.”
Sasan Goodarzi, CEO of Intuit, said that the acquisition of Credit Karma will help fuel efforts to “create a mobile, personal financial assistant for consumers.”
“We will help consumers achieve financial success … by helping them find the right financial products, put more money in their pockets and provide financial expertise and advice,” he added.
Both companies also stressed the benefits of the deal for consumers of a transaction that had stirred competition concerns among federal regulators.
The acquisition will lead to “unparalleled offers on credit cards, loans and insurance,” while “the platform” will enable customers to “maximize their tax refund and connect them to high-yield savings accounts and checking accounts,” according to the press release put out by Intuit and Credit Karma.