The takeover of the Dutch neobroker Bux by N26 was imminent. But at the last minute, the Berlin-based smartphone bank cancelled the deal. The reason was disagreements about the future management structure.

Fintech start-up N26 was planning to take over Dutch securities trader Bux, but then backed out at the last minute, as Handelsblatt reports. The purchase would have been the biggest deal in N26’s history. The takeover would have allowed N26 to offer its customers the purchase and sale of shares and ETFs. Several people familiar with the opportunity report that the deal fell through shortly before closing because N26 felt the complexity of the acquisition was too high and the two companies could not agree on a new management structure and valuation. In the last financing round in 2021, N26 was valued at 7.7 billion euros, making it one of the most valuable fintechs in Germany. A valuation of more than 100 million euros was under discussion at Bux, an insider reported.

Bux did not want to comment on the topic. An N26 spokeswoman told Handelsblatt: “We always look at interesting companies that fit our strategic goals, but we don’t comment on rumours or speculation as a matter of principle.”

Declining trading activity in brokerage business

At the beginning of the Covid 19 pandemic, stock and EFT trading was still very popular: Investors were more concerned than ever with how to invest their money. Last year, however, trading activity dropped significantly as a result of the stock market collapse, which was felt by neobrokers like Bux.

During the takeover negotiations, N26 may have intended to take advantage of the current market situation and acquire Bux at a relatively low price. In addition, as a result of the turnaround in interest rates and the slump in technology stocks, investors have become fundamentally more reluctant to finance start-ups.

Another aspect that may have played a role in the negotiations, according to Handelsblatt, is that N26 had made it clear at the end of 2022 that an IPO of its own was currently not an issue in view of the difficult market environment. The priority was to eliminate the deficiencies identified by the financial supervisory authority Bafin.

According to Handelsblatt, a possible reason for the cancellation of the Bux takeover could therefore also be the avoidance of additional complexity and governance problems, as this could also be viewed positively by the financial supervisory authority.

About Bux

The neobroker Bux was founded in Amsterdam in 2014 and initially focused on trading contracts for difference (CFDs). In the meantime, the product portfolio also includes trading in shares and ETFs. According to its own information, the Dutch company is active in a total of eight markets, including Germany and France, and has more than one million customers.