Open Lending, LLC ("Open Lending"), a leading provider of lending enablement and risk analytics solutions to financial institutions, and Nebula Acquisition Corporation (NASDAQ: NEBU) ("Nebula"), a special purpose acquisition company sponsored by True Wind Capital, L.P. ("True Wind"), today announced that they have entered into a definitive business combination agreement. Under the terms of the agreement, Nebula will acquire Open Lending through a new Delaware holding company (the "Company"), which will become a publicly-listed entity with an implied estimated enterprise value at closing of approximately $1.3 billion.
The consideration payable to the stockholders of Open Lending will consist of a combination of cash and shares of common stock of the Company. In addition to the $275 million of cash held in Nebula's trust account (assuming no redemptions), additional investors have committed to participate in the transaction through a $200 million private placement of common stock at $10.00 per share anchored by True Wind and several noteworthy and leading fundamental investors.
Open Lending is a lending enablement platform for the automotive finance market powered by proprietary data, advanced decisioning analytics, an innovative insurance structure and scaled distribution. The platform enables near-prime consumers, approximately 50% of borrowers today, to finance their vehicles at more attractive rates when compared to traditional lending alternatives, while presenting a similar risk profile to the lender as that of a prime borrower. Furthermore, Open Lending's technology platform unlocks value for a diverse partner ecosystem, benefitting dealers, lenders, insurers and OEM's. Through the platform, Open Lending facilitated over $1.7 billion of automotive loans in 2019 for over 275 financial institutions, taking no balance sheet risk. Open Lending management expects EBITDA margins to exceed 50% and organic revenue growth to top 80% in 2020, representing over 140,000 loans facilitated.
Upon the close of the transaction, the Company intends to change its name to Open Lending Corporation and is expected to trade on The Nasdaq Stock Market under a new ticker symbol. Open Lending's management team, led by John Flynn, Co-Founder, President and Chief Executive Officer and Ross Jessup, Co-Founder, CFO, and COO, will continue to lead the Company. Open Lending's management team is expected to roll 70% of their existing equity interests in the business. Open Lending's existing minority investor, Bregal Sagemount ("Bregal"), a prominent growth equity firm, will continue as a public stockholder. To facilitate the transaction and maximize future public market performance, Nebula's sponsor and management team have agreed to forfeit all of their founder warrants and Nebula intends to launch a solicitation to retire all outstanding public warrants.
John Flynn, Co-Founder, President, and CEO of Open Lending, commented, "We are immensely proud of Open Lending's accomplishments since our founding over 15 years ago, and we are excited to lead the next stage of development alongside the True Wind team. We believe there is significant runway for new growth opportunities within our existing base of credit unions and banks as well as through untapped opportunities such as OEM captive partnerships."
Adam Clammer, Co-CEO of Nebula and Founding Partner of True Wind, said, "Open Lending's ability to demonstrate consistent organic growth and high levels of profitability represents an exciting investment opportunity within the risk-based analytics ecosystem. John and his team have developed a highly-scalable technology platform that helps hard working consumers get into a new or used car at the best rate possible. We look forward to partnering with Open Lending's management team and Bregal at this exciting inflection point in the company's growth."