LendingTree entered into a definitive agreement to acquire Ovation Credit Services, an online credit repair company, for $20.75 million.
Up to now, LendingTree has been on the sidelines operating as an educator and facilitator for credit consumers, but this move puts them on the field and in play in the credit repair game.
"According to industry estimates, almost one-third of Americans have poor or bad credit, and our own consumer traffic mirrors this situation," LendingTree Founder and CEO Doug Lebda said in a statement.
"By acquiring Ovation Credit Services, LendingTree will be able to better educate consumers about credit management and provide options for those consumers who have struggled with obtaining financing," Lebda added. "Ovation Credit Services' experienced management team, strong credit bureau relationships and customized software platform will ultimately enable LendingTree to help more consumers achieve their original financial goals through the LendingTree platform."
Ovation’s claim to fame is it proprietary software that smooths the process of credit repair.
"LendingTree is committed to helping all consumers meet their financial goals, regardless of where they are in the credit spectrum," Lebda said in a statement.
The purchase will breakdown into a $12 million cash payment at closing, and an additional $8.75 million in consideration payments. The sale is to close in Q2 this year.
"We are incredibly excited to join the LendingTree team," Ovation Credit Services President Terry Cordell said in a statement. "Given LendingTree's emphasis on consumer education and empowerment, we are confident that this is the right platform for Ovation Credit Services to expand its reach and help more consumers improve their credit health."
