Athena strikes stunning $2bn funding deal with Cerebus and Bluestone

  • By Elizabeth Fry

 Cerberus Capital Management, a global leader in alternative investing with over US$48 billion under management, and its subsidiary Bluestone, has partnered with Athena, the Aussie fintech disruptor, to supply $2 billion in funding over the next three years. The deal represents one of the largest fintech strategic partnerships ever in Australia. 

 This is the second whole-loan funding arrangement that Athena has announced in the last six months, the first being with Newcastle Permanent Building Society late last year for $300 million. Athena has developed an innovative platform to access wholesale funding from a broad range of major financial institutions. 

 “Athena’s innovation on funding arrangements supports our accelerated lending growth and allows us to help more Aussie borrowers pay down their home loan faster and capture big interest savings,’ said Michael Starkey, the online lender's co-founder, and chief operating officer. “This deal is further validation that there is strong institutional demand for innovative funding models.  

 
Fastest growing fintech 

Athena is one of Australia’s fastest growing fintechs having settled over $2 billion in applications since its February 2019 launch - a growth rate expected to accelerate given this latest funding deal.  
For the second year in a row, the innovative online lender has won a Mozo Experts Choice Award for offering conceptive rates to customers in new ways. For instance, a feature of Athena’s latest loan is the promise to automatically decrease the variable rate on the loan as the balance is paid down. This ensures that the customer’s loan-to-value ratio lessens. 

The tie-up with Athena represents Cerberus’ fourth deal in the financial services sector in Australia. In addition to the acquisition of Bluestone in 2018, Cerberus acquired Angle Finance in 2019 and most recently, announced an agreement to acquire Westpac’s strategic alliances (Vendor Finance) business which is expected to be completed in the first half of this year.  

 
David McWilliam, head of Cerberus Australia added: “The deal with Athena is aligned with our focus on providing solutions to Australian businesses and customers. This strategic partnership brings together two complementary platforms with strong expertise in the residential home loans sector.” 

 Campbell Smyth, the head of Bluestone, a leading non-bank lender managing more than $10 billion in home loans, also agreed that the partnership builds on Bluestone’s foundation as a tech-enabled non-bank lender. “Athena shares our commitment to innovation and tailored solutions to meet customers’ evolving needs. We look forward to exploring strategic opportunities with Athena to expand our offerings and capabilities.” 

 Deloitte Financial Advisory has acted as lead financial adviser to Athena on the transaction. “Partnerships between established, global firms and local Australian fintechs drive more innovation and further competition in the Australian market - and most importantly better outcomes for customers,” added Deloitte Australia financial services M&A Partner, James Chown.