American investment giant DE Shaw is in discussions to spearhead a capital-raising round for UK digital bank Monzo that could value the lender at more than £7bn ($9.3bn), according to Sky News.
The asset manager has signalled interest in leading an equity injection of at least £300m in the coming weeks.
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Sources told the publication the final figure could reach between £300m and £500m, yielding an estimated pre-money valuation of roughly £7bn.
However, terms remain unfinalised and other prospective investors are involved in talks.
The development follows a Financial Times report last week indicating that Monzo was exploring a funding round at a £7.5bn valuation.
Monzo was valued at £4.5bn during a secondary share sale in October 2024, with its valuation expanding significantly over the subsequent two years.
The bank began exploring new capital-raising options and private equity stake sales after a potential £8bn to £10bn takeover by New York-listed Nu Holdings collapsed following media reports.
DE Shaw oversees roughly $125bn in assets and has become an active backer of technology disruptors.
Securing an investment from the firm would add DE Shaw to a shareholder register that already includes an arm of Google and a Singaporean sovereign wealth fund.
The company has also managed boardroom changes this year. Veteran banker Gary Hoffman stepped down as chairman, while Diana Layfield, a former executive at Google and Standard Chartered, took over as chief executive.
Monzo declined to comment on the funding talks, while DE Shaw did not respond to multiple emailed requests for comment.
