Axos Financial in San Diego has agreed to buy equipment leasing company Verdant Commercial Capital.
The $24.8 billion-asset Axos said in a press release that it expects to pay $43.5 million for Verdant, which had about $1.1 billion of loans and leases on its balance sheet as of Aug. 31, including $750 million of securitizations.
The deal is expected to close on Sept. 30.
Verdant can earn performance-based cash considerations over a four-year period if it generates a return on equity above 15%. The total payout is capped at $50 million.
Verdant originates small to mid-ticket leases between $50,000 and $5 million across six verticals.
“This acquisition provides us with more scale and enhances our existing equipment leasing business with good risk-adjusted returns,” Greg Garrabrants, Axos’ president and CEO, said in the release.
“We like Verdant’s specialization in vendor-based equipment leasing and believe we can scale this business profitably,” Garrabrants added. “We see opportunities to cross-sell commercial deposits and floorplan lending to manufacturers and dealers in several industry verticals such as specialty vehicles, golf, sports and entertainment.”
The deal should be 2% to 3% accretive in 2026 and 5% to 6% accretive the following year.
Keefe, Bruyette, and Woods advised Verdant.