Advent International eyes Monzo stake amid £10bn Nubank bid talks

Monzo, the digital lender whose rapid growth has turned it into one of Britain’s biggest consumer banks, is in talks about a sale to Brazil’s Nubank which could value it at between £8bn and £10bn, according to Sky News.

Sky News has learnt that Monzo has been approached about a combination with Nu Holdings, which is listed on the New York Stock Exchange and has a market capitalisation of $65.5bn (£49.4bn).

The discussions between Monzo and Nu Holdings are said to be at a relatively early stage, although the British company has engaged investment bankers from Morgan Stanley and Qatalyst to advise it and the outline terms of a deal are said to be under negotiation.

One source close to the process said an acquisition of the UK lender by the Sao Paulo-headquartered digital bank was one of two principal options being explored by Monzo’s board and shareholders.

The other is understood to be a new round of funding which would be expected to value Monzo at in excess of £8bn, with the proceeds used to facilitate further expansion in mainland Europe.

Also, Sky News has learnt that Advent, which recently explored a $53bn (£40bn) bid for PayPal, is one of several buyout firms which have held initial talks about acquiring a minority shareholding in Monzo. Advent has been a prominent investor in fintech businesses for years, having owned Worldpay, the payments giant, prior to its flotation on the London Stock Exchange.

Monzo has amassed a 16 million-strong customer base, with 15 million of those personal banking customers along with 1 million users of its business banking services.