The first Mexican unicorn, Kavak, announced it has signed structured financing agreements worth $810M with HSBC, Goldman Sachs, and Banco Santander.
Kavak operates as a buying and selling platform for used cars. The startup also reconditions the vehicles for sale in its own centers.
Through this deal, HSBC will provide $675M in financing to acquire Kavak’s current and future loan portfolio. Goldman Sachs and Santander will provide $135M worth of loans that are backed by assets, including warehouses and cars.
Kavak is currently negotiating other debt financing deals with banks. In 2022, the company could raise up to a total of $1.2B. According to the company, the firm is funded for at least 36 months:
“We are in a very strong financial position (…) We can ensure infinite runway, if we wanted to, we’ll just have to pace the growth,” Kavak’s chief financial officer Moises Flores said.
The company was valuated at $8.7B after it raised a $700M Series E round one year ago. Flores also described this agreement as the “Ferrari of debt”:
“This is the kind of thing that you achieve when you’re public, and you’ve been in the market for many years, and we’re doing this many years ahead of that.”
Read more on Bloomberg.
