Jack Dorsey's US payments platform Square is joining the Buy Now Pay Later arms race.
Square, the listed US payments fintech founded by Twitter’s Jack Dorsey, is set to acquire Australian Buy Now Pay Later firm Afterpay in a $29bn (£21bn) deal.
Afterpay, which says it serves more than 16 million consumers and nearly 100,000 merchants around the world, will be integrated into Square’s existing Seller and Cash App ecosystems eventually. This will mean any merchants using Square will be able to offer BNPL services at the checkout.
Anthony Eisen and Nick Molnar, who co-founded Afterpay in 2014 and still act as co-CEOs of the business will join Square upon completion of the deal. They will then lead Afterpay’s respective merchant and consumer businesses, as part of Square’s Seller and Cash App ecosystems.
Square says it will also appoint one Afterpay director as a member of Square's board at the same time but did not specify any individual.
Shareholders of Afterpay will see a 30 per cent premium through the deal in what is one of the largest fintech M&A activities ever and the largest take over of any listed Australian business.
“Square and Afterpay 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,” said Jack Dorsey, Co-Founder and CEO of Square.
“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.
The closing of the transaction is expected in the first quarter of 2022.