Square Inc. said it reached a deal with Afterpay Ltd. to acquire the buy now, pay later company in an all-stock deal valued at $29 billion.
Square said in a statement today that the acquisition “aims to enable the companies to better deliver compelling financial products and services that expand access to more consumers and drive incremental revenue for merchants of all sizes.”
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The company expects to close the deal in the first quarter of 2022.
Jack Dorsey, cofounder and chief executive officer of Square, said in a statement that the two 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.”
“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,” Dorsey noted.
Square said the deal is expected to accelerate the company’s “strategic priorities for its Seller and Cash App ecosystems. Square plans to integrate Afterpay into its existing Seller and Cash App business units, enable even the smallest of merchants to offer BNPL at checkout, give Afterpay consumers the ability to manage their installment payments directly in Cash App, and give Cash App customers the ability to discover merchants and BNPL offers directly within the app.”
Alyssa Henry, lead of Square’s Seller business said the buy now, pay later model “has been a powerful growth tool for sellers globally. We are thrilled to not only add this product to our Seller ecosystem, but to do it with a trusted and innovative team.”
Brian Grassadonia, lead of Square’s Cash App business, said the addition of Afterpay to Cash App “will strengthen our growing networks of consumers around the world, while supporting consumers with flexible, responsible payment options. Afterpay will help deepen and reinforce the connections between our Cash App and Seller ecosystems, and accelerate our ability to offer a rich suite of commerce capabilities to Cash App customers.”
Afterpay serves more than 16 million consumers and nearly 100,000 merchants globally, including major retailers in fashion, homewares, beauty and sporting goods. “Afterpay empowers consumers to access the things they want and need, while allowing them to maintain financial wellness and control,” Square said in a statement. “Afterpay also assists merchants in growing their businesses by helping to drive repeat purchases, increase average transaction sizes and provide their buyers with the ability to pay over time.”
Anthony Eisen and Nick Molnar, Afterpay cofounders and co-CEOs, said that 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.”
Eisen and Molnar are expected to stay on following the deal’s closing.