Posted 10 months ago | by Catoshi Nakamoto

Jack Dorsey’s parent payment company of Cash App, Square has agreed to a massive U.S. $29 billion all-stock deal to buy the Australian fintech company Afterpay – in a merger that some analysts state could “create a global transactions giant.”

AdobeStock 333122368 Editorial Use Only Square Buys Australian AfterPay, Buy Now, Pay Later Company For $29 Billion

In a press release, Square announced that following the acquisition of Afterpay, consumers “will receive the benefits of” its own Cash App product’s “financial tools, including money transfer, stock, and bitcoin purchases.” The billionaire dollar deal puts the value on Afterpay’s shares at $96, the majority of which are owned by the Australian firm’s co-founders Anthony Eisen and Nick Molnar. Dorsey’s firm will also buy up to 5% minority stake currently owned by the Chinese tech giant Tencent, who paid around $220 million for its shares in Afterpay last year.

Another benefit that Square stated it will integrate within its own Cash App is Afterpay’s “buy now, pay later” (BNPL) service.

In a Bloomberg report, Square’s Chief Financial Officer Amrita Ahuja was quoted stating that “the plan is for Square to integrate Afterpay into both its consumer Cash App and its Seller product for small businesses.” Meanwhile, Square has revealed details of its Cash App’s financial performance in the second quarter of the current financial year, with bitcoin-related yearly revenue up 200% compared to 2020s revenue of $875 million. The company stated that its Bitcoin revenue reached $2.72 billion in Quarter 2 of 2021 with a gross profit of $55 million, according to a letter to shareholders.

Square has seen significant growth in Bitcoin-related revenue despite a massive market correction. In Q2, massive FUD news aided a flash crash of the number one digital asset causing a drop of approximately 50 percent, as a result, Bitcoin logged one of its worst quarters on record.

Reuters quoted Truist Securities analysts stating that they expected Square to “invest heavily to integrate Afterpay and accelerate organic revenue growth.”

Reuters also reported that Wilsons Advisory and Stockbroking commented on the deal expressing that there are “few other suitors” who are “as well-suited as Square.” In addition, Credit Suisse analysts were quoted as calling the deal an “obvious fit” with “strategic merit.”

“Together, we can better connect our Cash App and Seller ecosystems to deliver even more compelling products and services for merchants and consumers, putting the power back in their hands,” Square Co-Founder Jack Dorsey said.

The deal can still be intervened by the regulatory Australian Competition and Consumer Commission, which has the power to approve or reject the deal. However, the agency stated that it would “consider it carefully” after it was able to review the full “details.” The agency still has a year, as the deal is expected to close in Q1 of 2022 and could still fall through.

Bitcoin is currently trading at [FIAT: $39,520.05] DOWN -4.6% in the last 24 hours according to Coingecko at the time of this report.

 

About Catoshi Nakamoto

c6ea0c3794492f30883e516d39b2597a?s=90&d=blank&r=g Square Buys Australian AfterPay, Buy Now, Pay Later Company For $29 BillionActivist/Journalist, former writer - We Are Change, The Mind Unleashed, Coinivore, others. Currently writing for - Activist Post and Bitboy Crypto. Not Right or Left Apolitical. I Care About Truths (CATS.) Cryptocurrency enthusiast, I mined and lost 100+ BTC in 2010-2011. I work with - Bitboy, SoMee, CEEK, Presearch, and W3BT aka FMW Media Group. Friend of mostly everyone who isn't a dick. Just A Cool Cat.