Intuit buying Credit Karma for $7.1B
Turbotax owner Intuit is buying consumer finance company Credit Karma in a $7.1 billion combination that aims to shift the landscape of consumer financial services.
By joining forces, Intuit and Credit Karma seek to create a personalized financial assistant that will provide insights and advice to help consumers find the right financial products.
“There hasn’t been that much innovation in the financial services world in the past two decades,” said Kenneth Lin, founder and chief executive of Credit Karma. “The combination of the two companies will really be able to move consumers forward.”
The deal brings together two wellknown personal finance companies. Intuit is the maker of Mint and Turbotax, the online tax filing service used by millions of Americans.
Credit Karma, which makes money through credit cards and loans, has more than 100 million members in the U.S., Canada and U.K., including almost half of all U.S. millennials. It generated $1 billion in revenue in 2019. Credit Karma will remain separate after the deal closes.
“Why this works so well is that we’re able to maintain our independence while leveraging the capabilities and resources of Intuit,” Lin said. “The two businesses are highly aligned, so from an investor perspective, they shouldn’t expect anything different.”
The announcement confirmed early news reports.
The companies said they expect the deal to close in the second half of 2020, pending regulatory approval.
If the cash and stock deal doesn’t fall through, Intuit and Credit Karma will be the latest financial technology companies to join forces this year.
Morgan Stanley announced plans to buy E*trade last week for about $13 billion in a deal gives the big bank access to brokerage customers and employees with company stock.
Visa announced plans in January to purchase the financial technology company Plaid for $5.3 billion, giving the payment processing giant access to other types of money transfer systems.
Contributing: Dalvin Brown, USA TODAY