Bloomberg reported last week that the deal was in negotiations and could reach $850 million.
“The transaction represents an important step toward American Express’ goal of being an essential partner to small businesses through a broad range of payment, cash flow and financial management tools,” AmEx said in a statement Monday.
AmEx already is the biggest credit card issuer for small business and consumers, Bloomberg reported. So the deal will expand its lead.
“For several years, American Express has been expanding beyond our industry-leading commercial card products to offer our business customers a growing set of payment and working capital solutions,” said Anna Marrs, president of Amex global commercial services.
“This acquisition accelerates our plans to offer U.S. small businesses an easy and efficient way to manage their payments and cash flow digitally in one place, which is more critical than ever in today’s environment.”
And what does Kabbage add? “By bringing together Kabbage’s innovative technology and talented team with our broad distribution capabilities and over 60 years of experience backing small businesses, we can better help our customers successfully emerge from this challenging period and beyond,” Marrs said.
The acquisition is expected to close later this year.
Last month, AmEx posted an unexpected second-quarter profit, but saw revenue fall by nearly a third as consumer spending collapsed during the peak of the coronavirus pandemic.
AmEx shares traded at $98.20, down 2.2%, and have declined 21% year to date.