Social media Twitter’s Chief Jack Dorsey’s Square has agreed to buy out an Australian company fir ‘buy now, pay later’ services called Afterpay.
The $ 29bn deal (A $ 39bn; £ 21bn) will have to be Australia’s largest take-ofer to date.
Square And Afterpay Have The Same Goal
The offer price from Square is at more than 30% premium on the closing price of the Afterpay stock price on Friday.
This merger will create a huge installment payment company and industry expects to see significant growth.
“Square and Afterpay have the same goal. We have built our business to make the financial system fair, accessible and inclusive, and Afterpay has built a reliable product that meets those principles,” square founder and chief executive Jack Dorsey said in a statement.
Shareholder Approval Pending
The Australian payments company said its board unanimously recommended the decision to shareholders, who are expected to own 18.5% of the new company.
Founded in 2014 by Aussies Nick Molnar and Anthony Eisen, Afterpay has has a 16 million customer base and is in use by more than 100 million businesses worldwide.
Second Quarter Results
The deal between these two buy-now pay-later companies stipulates that Afterpay will be able to expand rapidly in America. Its latest figures show that sales in the United States nearly tripled this time to $ 8.15bn.
At the same time Square also announced its second quarter earnings which showed that gross profit increased by 91% to $ 1.14 billion compared to the same period last year.
Competition
Afterpay shares were trading higher over 20% higher on Monday’s trading in Sydney.
The high popularity, rapid capture by users and the low regulations have led to the rapid growth of purchases now, and do the payment later industry.
In recent weeks there have been reports that tech company Apple is working with its services that will allow consumers to pay for purchases in installments.