Revolut Reached Agreement with SoftBank Regarding Share Deal, Eliminating Obstacle to Obtaining UK License

​UK-based fintech firm Revolut has reached an agreement with investor SoftBank to simplify its ownership structure, removing a key obstacle in obtaining a long-awaited banking license in its home market. This move comes after months of negotiations, during which SoftBank demanded substantial compensation in exchange for relinquishing its priority class of shares.

Revolut's path to acquiring a UK banking license required the elimination of preference shares held by various investors, including SoftBank. The Bank of England mandated that Revolut consolidate its six classes of shares into one as a prerequisite for the license, a process that has been ongoing for over two and a half years.

SoftBank, which led an $800 million funding round in 2021, valuing Revolut at $33 billion, sought compensation for forfeiting the protections associated with its share tranche. The standoff with SoftBank had been a significant factor preventing Revolut from promptly obtaining a banking license.

The agreement in principle struck last week does not include any new issuance of "top-up" shares for SoftBank, nor will it have a financial impact on the company, the FT report said.

Other investors such as Tiger Global Management, venture capital firm TCV, Balderton Capital and Ribbit Capital have all either agreed to transfer their shares into a single class, or are in final talks to do so.

The BoE's regulatory arm is the lead agency for approving banking licence applications in the country, which must also be signed off by the Financial Conduct Authority.