Figure Completes Kiavi Acquisition With About $590 Million Cash Consideration

Figure Technology Solutions completed its acquisition of residential real estate lender Kiavi on September 1, paying about $590 million in cash consideration net of cash acquired. Kiavi survived the merger as a wholly owned Figure subsidiary, bringing its lending technology and debt service coverage ratio, or DSCR, loan business into the blockchain-focused financial technology company.

About $590 million is narrower than the $717 million total purchase price Figure announced in June for the broader Kiavi arrangement. That earlier structure also covered assets being acquired through a joint venture involving Figure and Sixth Street. The two numbers therefore describe different pieces of the acquisition rather than a simple before-and-after change in price.

The closing filing separates Figure’s purchase from the broader $717 million structure

Figure’s September 1 filing with the Securities and Exchange Commission says the company paid approximately $590 million, net of cash acquired, for Kiavi’s technology platform and DSCR loans on Kiavi’s balance sheet. The amount remains subject to customary adjustments tied to items including cash, indebtedness, expenses and operating net working capital.

When the companies announced the acquisition in June, Figure described a wider $717 million purchase structure. Its investor presentation said residential transition loan assets would be transferred to a Sixth Street-controlled joint venture, while the operating platform and DSCR loans would be integrated into Figure. The final SEC filing focuses on the consideration paid by Figure at its closing, so the $590 million figure should not be read as a replacement for every component included in the June total.

The merger agreement originally called for about $532.4 million in cash to Kiavi equity holders, subject to adjustments for Kiavi’s cash, indebtedness, expenses, operating net working capital and warehouse working capital. By closing, Figure reported the roughly $590 million net-of-cash-acquired amount. Those measurements are also not directly interchangeable, and the filing does not characterize the difference as an increase in the negotiated headline value.

At closing, Figure cleaned up Kiavi financing arrangements. It repaid all outstanding obligations under a Kiavi credit agreement and terminated a master repurchase agreement involving Kiavi Funding entities and Deutsche Bank’s New York branch. The related financing documents ended and liens securing those obligations were released, according to the SEC filing.

Figure used $600 million of 8.5% senior notes as the main funding source

The acquisition was financed primarily with proceeds from Figure’s $600 million principal amount of 8.5% senior notes due in 2031. The notes closed on July 14, replacing a $600 million bridge facility that Figure had arranged with Bank of America and Barclays when it signed the Kiavi agreement. The bridge remained undrawn and was terminated after the bond financing closed.

Figure’s latest quarterly filing puts actual net proceeds from the notes at $586.5 million after offering costs and discounts. That is slightly below the approximately $590 million cash consideration reported at closing, which is consistent with Figure’s September filing saying the notes were the primary funding source rather than the sole source. Interest is payable semiannually beginning in January 2027, and the notes mature on July 31, 2031 unless repurchased or redeemed earlier.

The debt financing adds a meaningful fixed-cost obligation at a time when Figure’s operating results have been expanding quickly. For the second quarter, Figure reported $225.6 million of net revenue and $87.4 million of net income, compared with $106.1 million and $30.0 million a year earlier. Adjusted EBITDA, a non-GAAP measure, rose to $119.4 million from $52.9 million, while the adjusted EBITDA margin increased to 54.6% from 47.2%.

Acquisition-related costs were already visible before Kiavi closed. Figure excluded $4.7 million of such costs from adjusted EBITDA for the June quarter. In June, management said it expected Kiavi to be accretive to earnings per share, support its 60% medium-term adjusted EBITDA margin target and produce an unlevered cash payback in less than four years. Those remain company projections rather than realized post-acquisition results.

Kiavi expands Figure’s first-lien and real estate investor lending business

Kiavi provides financing to residential real estate investors, including short-term residential transition loans used for properties that may be bought and renovated, and longer-term DSCR loans for rental properties. Figure said in June that Kiavi had funded more than $30 billion of loans since its founding and reported more than $250 million of revenue and more than $100 million of EBITDA for 2025.

The strategic attraction is not limited to Kiavi’s historical revenue. Figure expects the platform to add more than $7 billion of annual first-lien volume to Figure Connect and more than $100 million of monthly flow to Democratized Prime, its blockchain-native lending marketplace. Those figures are forward-looking estimates from Figure and depend on the integration producing the volume and funding relationships management expects.

For comparison, Figure Connect handled $2.77 billion of volume in the second quarter, up from $766.7 million a year earlier. Consumer Loan Marketplace volume reached $4.26 billion, while Figure said 65% of that volume was flowing through Figure Connect. The company had 489 active origination partners at quarter-end, giving Kiavi a larger existing network through which Figure can try to distribute and finance its loan production.

Figure’s stated strategy is to use Kiavi to increase its exposure to first-lien lending while moving more loan origination and capital-markets activity onto its blockchain infrastructure. DSCR loans were already part of Figure’s consumer lending marketplace, while Kiavi adds a larger operating platform and residential transition loan capabilities. Kiavi assets are also slated to become an early application for Adaptor, an AI product intended to standardize data from different loan originators before assets enter Figure’s marketplaces.

Figure co-founder and Executive Chairman Mike Cagney framed the acquisition in June as part of the company’s broader push to bring additional asset classes onto blockchain-based market infrastructure. With the closing now complete, the key uncertainties shift from whether the companies can finish the acquisition to whether Figure can integrate Kiavi, achieve the expected volume growth and realize the financial benefits it projected. The September 1 filing did not introduce a new synergy target or revise the earlier earnings-accretion and payback expectations.