Why Is the Capex.com and NAGA Merger A Game-Changer?

Fazzaco News recently just covered the shocking news​ of CAPEX.com, a leading online trading platform, announcing a strategic merger agreement with The NAGA GROUP, the provider of the All-in-One Financial Super App, NAGA.

The deal is said to be creating a global fintech powerhouse with a combined user base of over 1.5 million and a projected revenue of USD 90 million in 2023. But what does this merger mean to the market? What is the story behind this merger? Let's dig a little deeper into it today.

What Are CAPEX.com and NAGA?

CAPEX.com is an internationally regulated, fast-growing broker that offers online trading services for over 2,100 financial instruments, including forex, stocks, commodities, indices, ETFs, and cryptocurrencies. It has a user base of over 60 thousand people who were active in 2023 alone, and it grows by more than 15,000 signups every month on average.

The broker has a strong presence in Europe and the Middle East, with multiple licenses from regulators such as Cyprus Securities and Exchange Commission (CySEC), the Abu Dhabi Global Market (ADGM), the Financial Sector Conduct Authority (FSCA) of South Africa, and the Seychelles Financial Services Authority (FSA).

Despite a highly competitive market climate, CAPEX.com has raised USD 31 million in equity funding thus far, and its revenues have grown fast over the last three years, from USD 26 million in 2021 to a projected USD 40 million in 2023.

NAGA​ is a German-based fintech company that offers social trading, payment services, and spot cryptocurrency trading. NAGA has over 1 million users from more than 100 countries and has processed over USD 200 billion in trading volume since its launch in 2015.

NAGA is also regulated by CySEC and offers over 950 financial instruments, including forex, stocks, commodities, indices, ETFs, and cryptocurrencies.

What is particularly worth noting is that NAGA boasts a social trading network, where users can copy the trades of top performers, chat with other traders, and earn rewards for sharing their insights and strategies. Fazzaco learned that in August this year, NAGA established a collaboration with Rezolve AI Limited (Rezolve)​, a generative Artificial Intelligence (AI)-powered modern Employee Service Desk, for the purpose of integrating the latter's 'Brain' solution into its social trading app and its proprietary payments technology.

Why Are CAPEX.com and NAGA Partnering?

CAPEX.com and NAGA have agreed to a non-cash capital increase, which means that CAPEX.com and its shareholders will invest a total of USD 15 million in equity in the company combination. The deal, which has the backing of NAGA's biggest shareholders, guarantees an extension of the repayment of the company's present USD 5 million loan to the end of 2025 and further boosts liquidity for expansion in the near future.

The new investor will take the majority stake in the combined company, which will keep the NAGA brand, through a mix of direct cash infusions and the donation of 100% of CAPEX.com shares to NAGA. After this funding infusion, Octavian Patrascu, the founder and CEO of CAPEX.com, is expected to take over as group CEO, while Benjamin Bilski, the founder and CEO of NAGA, will remain as the chief visionary officer and board member.

The merger will create a global fintech powerhouse with a combined user base of over 1.5 million and a projected revenue of USD 90 million in 2023. The combined firms will operate eight licenses worldwide and will be able to offer their services in over 50 countries, including the rapidly expanding MENA area, where NAGA will be able to scale up its revolutionary social trading.

By providing social trading, payment services, and spot cryptocurrency, NAGA's patented technology will take advantage of CAPEX.com's current customer base, boosting the platform's lifetime value and generating extra revenue. All things considered, the business combination is anticipated to be able to save up to USD 10 million in yearly operational expenses, including staff, technology, regulatory overheads, and costs of goods sold (COGS). In concert, marketing initiatives will result in increased bidding power for sponsored traffic as well as increased domain and platform authority, which should greatly reduce client acquisition costs and enhance brand recognition.

Fazzaco believes that this merger will leverage the complementary strengths and expertise of both companies, creating a synergistic effect that will drive innovation and growth in the fintech sector. The combined company will have a strong and experienced management team, a diversified product portfolio, a loyal and engaged customer base, and a solid financial position.