Credit Karma, one of the world's most valuable financial technology (fintech) companies, is buying U.K. credit scoring service Noddle from TransUnion to make its first expansion beyond North America.
The deal, announced Monday, will see Noddle's more than 35 employees in the English cities of London and Leeds join Credit Karma. The San Francisco-based company, which currently operates in the U.S and Canada, plans to more than double its British workforce in the next 12 months.
The agreement will also see Credit Karma add Noddle's more than 4 million customers to its platform, increasing the fintech firm's total global user base to over 89 million.
Financial terms of the transaction were not disclosed. The acquisition is subject to approval from U.K. financial watchdog the Financial Conduct Authority, and is expected to close either later this year or by early 2019.
"We are driven by our mission to help people make financial progress," Nichole Mustard, Credit Karma's chief revenue officer, said in a statement on Monday.
"To truly deliver on this, we knew we needed to expand beyond North America. The U.K. was an obvious next step and Noddle is the ideal partner to help us get there."
Credit Karma offers customers free access to credit scores and reports from credit reporting agencies Equifax and TransUnion. It makes money by matching users with financial products like credit cards and personal loans offered by lenders.
The firm says it is profitable and, according to a report by Bloomberg earlier this year, it posted revenue of $682 million last year — although that missed its own 2017 revenue goal of $790 million, the publication reported, citing an internal presentation.
Since it was founded in 2007, the company has evolved its services to help connect customers with other products, including auto loans and insurance.
Credit Karma was last valued at $4 billion after U.S. private equity giant Silver Lake bought a $500 million stake in the firm earlier this year, making it one of the most valuable private fintech firms in the world.
A move into the U.K. market sees Credit Karma competing directly with rival credit scoring start-up ClearScore, and gaining access to what is seen internationally as a major hub for fintech. The firm touts its expertise in data modeling as a significant feature setting it apart from others in the financial services industry.
The news comes just a few months after TransUnion bought Noddle's parent company, Callcredit, from private equity firm GTCR for £1 billion ($1.3 billion), in its first expansion into Europe.
"We are proud to have partnered with Credit Karma from its inception to empower tens of millions of consumers with the information they need to make smarter financial decisions," John Danaher, TransUnion's president of consumer interactive, said in a statement on Monday.
"This deal represents an expansion of our mission to the United Kingdom, where we will expand free access to data and tools for consumers that further our commitment to providing information for good. We look forward to supporting CreditKarma as they continue to expand globally."
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