Goldman Sachs acquired Greensky, which is a fintech lender company, in 2021. Now, Goldman Sachs is reportedly looking to divest the business, which means it could face a writedown of $2.2 billion.
According to one bidder, the loan origination platform of GreenSky is worth $300 million. According to another, the platform is worth $500 million, which highlights the difference between valuations.
However, the bids for buying the GreenSky are not up to the expectations of Goldman Sachs, which is a rather troubling sign. GreenSky mainly deals in home improvement loans that are provided to consumers.
Goldman Sachs Shares Down By 1.4%
During the morning trading session, Goldman shares were down by 1.4%, which tells us that investors are not looking at this news so far!
When a Goldman spokesperson was approached for comment, they added that they were in the middle of the process. They also pointed out how the company is pleased with the healthy participation of different bidders. But when asked about the date of writing down, no details were revealed.
According to experts, Goldman could face a writedown during the GreenSky sale process. In addition, the goodwill amount is expected to be around $500 million. Another scenario is that the write-down might be the premium that was above the book value of assets.
During the first round of bids, several lenders and asset managers were involved, such as Synchrony Bank, Sixth Street Partners, Apollo Global Management, KKR, and Warburg Pincus.
But the way things are going on with the bidding process, it appears that Goldman Sachs might not get what it originally paid for the GreenSky. Another scenario is that the company might back out of the sale process if it feels the bids are not up to the mark.
In the next few days, more details will become available about the deal and thus could provide clarity on what's going on! In the meanwhile, Goldman Sachs shares may continue to experience higher than usual trading volumes.