Plastiq Files for Bankruptcy and Secures Acquisition Deal with Priority


Plastiq, a B2B payments company previously valued at $480 million, has filed for bankruptcy in a Delaware court. The move highlights the challenges faced by some standalone consumer-facing businesses, despite the current investor preference for B2B fintech companies.

On the same day as the bankruptcy filing, Priority Technology Holdings announced its intention to acquire Plastiq, pending court approval. While the full terms of the deal were not disclosed, it includes a $27.5 million cash payment. According to the chief restructuring officer’s estimates in the bankruptcy court filing, Plastiq’s assets and liabilities range between $50 million and $100 million.

Plastiq, known as an SMB credit card and payments company, has raised approximately $140 million in funding from investors such as Kleiner Perkins, B Capital Group, and Top Tier Capital. The company had previously announced plans to go public through a merger with Colonnade Acquisition Corp. II, valuing it at $480 million including debt. However, the SPAC deal fell through in March.

Prior to the cancellation of the SPAC deal, Plastiq was facing liquidity issues and had failed to maintain a minimum cash balance, as revealed in the bankruptcy documents. In an effort to expand its services, Plastiq had acquired financial software company Nearside for approximately $57.2 million. However, the business was later shut down due to technology and security concerns.

Plastiq had faced additional challenges when Silicon Valley Bank, where it held its operating bank accounts, experienced a shutdown in March. As a result, Plastiq transferred its operations to Priority, eliminating its reliance on Silicon Valley Bank and ensuring continuity.

The acquisition by Priority Technology Holdings provides a potential lifeline for Plastiq as it navigates bankruptcy proceedings. The ultimate outcome will depend on court approval and the ability to restructure its operations under new ownership.

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