Navient To Acquire Earnest For $155 Mln In Cash

(RTTNews) - Navient (NAVI) said that it has entered into an agreement to acquire Earnest, a financial technology and education finance company, for $155 million in cash.

Effective October 4, 2017, Navient will suspend its remaining share repurchase program through year end 2018 to allocate capital towards growing the education lending business and building book value. The company's annual dividend of $0.64 per share is unchanged.

Closing of the transaction is expected in the fourth quarter of 2017, subject to customary closing conditions.

Founded in 2013, Earnest serves financially responsible, digitally native consumers who have been underserved by traditional banks. The company is expected to originate nearly $1 billion in student loan refinancing loans in 2017.

As part of Navient, Earnest will continue as a distinct brand and will be led by its current management team, including founders Louis Beryl and Ben Hutchinson.