The $7.1 billion consideration will take the form of cash and stock. The shares of Intuit common stock were valued at approximately $299.73 per share.

The total consideration includes an estimated $1 billion of equity awards that will be expensed over up to three years. Following the close of the transaction Intuit will issue approximately $300 million of restricted stock units to Credit Karma employees, which will be expensed over four years.

Qatalyst Partners was Intuit’s financial advisor on the deal, with Latham & Watkins serving as legal advisor. Goldman Sachs was Credit Karma’s financial advisor, with Skadden, Arps, Slate, Meagher & Flom LLP and Wilson Sonsini Goodrich & Rosati serving as legal advisors.

Credit Karma’s revenues totaled nearly $1 billion in 2019, up 20 per cent on the previous year.

“The combination brings together two technology leaders with a shared goal to help solve the personal finance problems that consumers face today, regardless of their financial situation – managing debt, maximizing savings, access to better credit cards and loans –  with an aim to put more money in consumers’ pockets,” an Intuit statement said.

Many consumers struggle with not knowing or not fully understanding their finances. Household debt in the US has hit $14.1 trillion including, among other sources, $9.6 trillion in mortgage debt, nearly $1 trillion in credit card debt and $1.5 trillion in student loan debt. In addition, 23 million people in the US relied on at least one payday loan in 2018 to get faster access to cash. “At the same time, we know consumers want to improve,” said the Intuit statement. “In fact, 60 per cent of consumers say they are trying to improve their credit score.^”

Sasan Goodarzi, CEO of Intuit, said: “Our mission is to power prosperity around the world with a bold goal of doubling the household savings rate for customers on our platform. We wake up every day trying to help consumers make ends meet. By joining forces with Credit Karma, we can create a personalized financial assistant that will help consumers find the right financial products, put more money in their pockets and provide insights and advice, enabling them to buy the home they’ve always dreamed about, pay for education and take the vacation they’ve always wanted.”

Kenneth Lin (pictured), founder and CEO of Credit Karma, said: “We started Credit Karma with a goal to build a trusted destination for all consumers, to make financial progress regardless of where they are in life. We saw the opportunity to enrich people’s financial lives through transparency, simplicity and certainty.”

Founded in 2007, Credit Karma currently has 37 million active monthly users, of which 88 per cent engage on mobile devices.

Legal advisor to Credit Karma: Skadden, Arps, Slate, Meagher & Flom LLP

Legal advisor to Intuit: Latham & Watkins (the corporate deal team was led by Bay Area partners Luke Bergstrom and Chad Rolston, with associates Katherine Chen, Kaitlyn Fulcher, David Chen, Amanda Dillon, Bradley Alvarez, Bret Stancil, and Paul Jeffrey. Advice was also provided on benefits and compensation matters by Bay Area partner Julie Crisp and London partner Catherine Drinnan, with associates Mary Alice DiPietro and Sophie Cooper; on tax matters by Bay Area partner Grace Lee, with associates Anne McGinnis and Jeremiah Cowen; on technology transactions matters by Bay Area partner JD Marple, with associates Arielle Singh, Cassandra Wang, Adam Kaldor, and Heather Lui; on data privacy matters by London partner Deborah Kirk and Bay Area counsel Robert Blamires, with associates James Smith and Olga Phillips; on antitrust matters by Washington, D.C. partner Amanda Reeves, Bay Area partner Joshua Holian, and Washington, D.C. counsel Alan Devlin, with associates Kelly Fayne, Elise Nelson, Clarissa Lu, and Sydney Lakin; on securities matters by Washington, D.C. partner Joel Trotter, with associates Nicholas Monsees and Raul Gonzalez; on FCPA matters by Washington, D.C. partner Brian Kowalski, with associate Arianna Medina; on regulatory matters by New York partner Alan Avery and New York counsel Pia Naib; on UK corporate matters by associates Suneel Basson-Bhatoa and Georgina Scott; on UK financial regulation matters by London partner Nicola Higgs, with associates Becky Critchley and Katy Sanders; and on compliance matters by New York partner Blair Connelly, with associate Sindhu Boddu).