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Square to acquire Australian BNPL company Afterpay

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Square Inc., is planning to acquire Afterpay, an Australian ‘Buy Now, Pay Later’ company. Square has agreed to acquire all of the issued shares in Afterpay by way of a recommended court-approved Scheme of Arrangement.

The transaction has an implied value of approximately US$29 billion (A$39 billion) based on the closing price of Square common stock on July 30, 2021, and is expected to be paid in all stock. 

BNPL, also known as deferred payments, has gained popularity in recent years. It might become the next big thing for the fintech industry, both for customers and venture capitalists. “Buy now, pay later has been a powerful growth tool for sellers globally,” said Alyssa Henry, Lead of Square’s Seller business. “We are thrilled to not only add this product to our Seller ecosystem, but to do it with a trusted and innovative team.”

As of June 30, 2021, Afterpay serves more than 16 million consumers and nearly 100,000 merchants globally, including major retailers across key verticals such as fashion, homewares, beauty, sporting goods and more. “By combining with Square, we will further accelerate our growth in the U.S. and globally, offer access to a new category of in-person merchants, and provide a broader platform of new and valuable capabilities and services to our merchants and consumers. We are fully aligned with Square’s purpose and, together, we hope to continue redefining financial wellness and responsible spending for our customers,” said Anthony Eisen and Nick Molnar, Afterpay Co-Founders and Co-CEOs. 

“The transaction marks an important recognition of the Australian technology sector as homegrown innovation continues to be shared more broadly throughout the world. It also provides our shareholders with the opportunity to be a part of future growth of an innovative company aligned with our vision.”

Upon completion of the transaction, Afterpay’s Co-founders will join Square and help lead Afterpay’s merchant and consumer businesses, as part of Square’s seller and cash app ecosystems,