In last august We tell you that the mobile payment and fintech services company founded by block (formerly known as Square) announced the purchase of Afterpay (which operates in Spain as clear pay), a company that allows retailers to offer their customers an interest-free installment payment option. But to carry out the transaction it was necessary for the Bank of Spain to give the go-ahead.
With the approval, the purchase will be executed without the need to receive further approvals from the shareholders or the banking institution. The acquisition plan will comply with a detailed schedule ending on February 3rd.
In the words of Elena Rubinpresident of after pay: “We have shown that innovation in the field of finance is possible. The financial technology that we have created from Australia is reaching global proportions and both the team and I are especially excited about this new stage that we plan to execute on February 1, 2022. On behalf of the board of directors and the management, we want to give the thanks to our shareholders, clients and stakeholders for supporting the company’s potential at all times and for sharing our vision of offering equality and financial freedom to all our clients”.
Afterpay, the fintech that revolutionized online consumer credit
Once the sale is completed – Afterpay shareholders will receive 0.375 Block shares for each share they own. The price, agreed for 29,000 million dollars (around 24,380 million euros) represents a premium of 30% compared to the last closing price of Afterpay.
And it is that Afterpay shares were trading below 10 Australian dollars (around 6 euros) They skyrocketed with the pandemic, especially due to their rise in popularity during the health crisis. After news broke that Block intended to buy Afterpay last August, shares of the buy-now-pay-later company soared an additional 20%.
the australian company Afterpay has been a pioneer in the online installment payment market and it already had a presence in Europe thanks
Currently the company has 16 million users, who perceive their service as a responsible way of requesting a loan, easier and better than through a credit card. On the other hand, over 100,000 retailers globally using their service As one more way of paying their consumers, they pay the Australian fintech a fixed fee, plus a percentage of each order.
For its part, Block is a financial services firm headquartered in San Francisco, USA. It was founded by Jack Dorsey in 2009. Currently its value on the stock market is around 95,000 million euros.
This is not the first acquisition of the company to boost its mobile payments, since a year ago, the Spanish mobile payment company and the first fintech to achieve a banking license in Lithuania, for which is capable of operating throughout the European economic area.
The great popularity of “buy now, pay later”
According to Jack Dorsey, Block decided to buy Afterpay because both companies have a shared purpose: “We built our business to make the financial system more fair, accessible and inclusive, and Afterpay has built a trusted brand aligned with those principles”in his statement. “Together we can better connect our Cash App and Seller ecosystems to offer even more compelling products and services to merchants and consumers, putting the power back in their hands.”
By combining both fintech they will create a giant of online payments: in the last two years the “buy now, pay later” market has exploded, attracting especially younger generations who do not want to use credit cards opt for installment loans. Therefore, the intention of this purchase is that “Even the smallest of merchants can offer buy now, pay later and achieve higher conversions.”
Following the closing of this deal, Afterpay co-founders Anthony Eisen and Nick Molnar will join Block, helping to run the new giant’s respective retail and consumer businesses.
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