Goldman Sachs purchased GreenSky for a total of $1.7bn in 2021 and is now mulling to sell it to the group of investment companies, including Sixth Street, Pacific Investment Management and Kohlberg Kravis Roberts & Co. (KKR), for around $500m
US-based investment bank Goldman Sachs is reportedly in advanced negotiations to divest its speciality lending business GreenSky to a group of investment companies.
The investment companies include Sixth Street, Pacific Investment Management and Kohlberg Kravis Roberts & Co. (KKR), the Wall Street Journal reported.
Goldman Sachs purchased GreenSky for a total of $1.7bn in 2021 and is now looking to sell the business for around $500m, a significant loss to the company.
In April this year, the company announced its plans to sell GreenSky and said it would book a significant write-down on the sale in June.
Last week, Goldman Sachs chief executive David Solomon said that the company is focused on restructuring its consumer business, including selling GreenSky, said the publication.
Established in 2006, GreenSky is a financial technology company based in Atlanta, Georgia.
The company offers technology to banks and merchants to make loans to consumers for home improvement, solar, healthcare, and other purposes.
Goldman acquired GreenSky during the peak of the Covid-19 pandemic when consumers stayed at home, which prompted them to spend on renovations.
As the situation normalised, coupled with increased interest rates and a rise in building materials prices, GreenSky’s business weakened, reported Reuters.
Last month, Goldman was reportedly mulling to divest a part of its wealth business, as part of its strategy to move away from high-net-worth clients in mass markets, towards the ultra-rich.
The bank is exploring alternatives for its registered investment adviser (RIA) unit Personal Financial Management (PFM), which manages about $29bn, reported Reuters.