SYDNEY: ARC Funds Limited (ASX:ARC) has executed a binding agreement with ausbiz Group Pty Ltd to acquire a minority 30% equity interest in ausbiz Capital Pty Ltd, currently a 100% subsidiary of ausbiz Group.

ausbiz Capital, part of ausbiz Group, is a new business established to offer high-quality financial products and services to ausbiz Group’s ever-growing subscriber base, which currently exceeds 110,000. This business is led by Simon van Es and plans to launch initial products in November 2024.

The initial agreement between ausbiz Group and ausbiz Capital is an exclusive 3-year term where ausbiz Group will provide ausbiz Capital’s marketing & promotion services to ausbiz Group’s existing database of over 110,000 subscribers.

The board of ausbiz Capital will comprise of Simon Van Es (Managing Director), Wayne Mo & Scott Beeton. All board members have a proven track record in creating, building and running similar financial services businesses.

ARC will initially invest $670k for a circa 22.3% interest in ausbiz Capital in the first tranche.

ARC will then make a further commitment of $330k, which will be divided equally across another two investment tranches, with the second tranche scheduled for around January 2025 and the third and final tranche scheduled for around April 2025. On completion of the final investment, ARC will own 30% of ausbiz Capital for $1 million.

This transaction is governed by a subscription agreement and an ongoing shareholders agreement containing standard commercial terms.

Scott Beeton Managing Director of ARC Funds said: “This strategic investment with ausbiz Capital is a very exciting milestone for ARC in its quest to rapidly expand its business. I am also very excited to work again with Simon and to assist him to develop ausbiz Capital into a leading financial services firm for self-directed investors.”

Kylie Merrit Founder & Managing Director ausbiz Group said: “Through its media business, the ausbiz Group has built a highly engaged subscriber base.

We welcome ARC’s investment into the new ausbiz Capital business as we continue to find innovative and effective ways to connect our investor base with quality ideas and opportunities.”

Simon Van Es, Managing director of ausbiz Capital, added: “After careful evaluation of several strategic partners, we are excited to collaborate with ARC Funds to bring this unique business venture to life through ausbiz Capital. This partnership represents a key milestone in establishing a business designed to bring value and opportunity to self-directed investors”.