statements regarding the future performance of Square and Afterpay, the perceived synergies and . Keane expects attention will turn to the "significant future synergies in the Afterpay deal." Assuming the . This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We also use third-party cookies that help us analyze and understand how you use this website. Money: The True Story of a Made-Up Thing " Square and Afterpay have a shared purpose to improve customer outcomes, to make the financial system fairer and more inclusive," Ms Rubin said. The good news is BNPL providers ride their debit rails, moving cash purchases online and increasing purchase sizes. Square was simply the device that processed the transaction. Since BNPL is an alternative to traditional credit, the increased awareness from the Cash App integration should quickly bolster adoption for Afterpay's solution. Spanning two alphabetically arranged volumes, these commentaries reveal how the songs came to be and the people who inspired them. This website uses cookies to improve your experience while you navigate through the website. In the US . Square Stock: Afterpay Acquisition Makes It Market Leader ... For the likes of VISA, AMEX and Mastercard, with their network of network strategies, the Square/Afterpay acquisition is both a threat and an opportunity. This followed the release of the US company’s third-quarter results the very next day. Square and Afterpay Have Huge Synergies — and Dorsey Has a Plan. Who Cares This would mean that the M&A activity would shoot up and valuations would skyrocket. Now with Afterpay, Square has added a consumer credit product for those Cash App users to use at more 96,000 worldwide, giving consumers more of a reason to sign onto the Cash App proposition. Indeed, while Afterpay is expected to help boost Square's 'gross profit growth', it is also likely to negatively impact the company's Adjusted EBITDA margins, during the early stages of the acquisitions, management said . We do believe that having both systems is our ultimate superpower and differentiator – having both ends of the counter, two different audiences, of sellers and individuals is really important. The combination leverages Square’s integrated POS platform and merchant services capabilities to keep and grow an expanded merchant base. Does the lower Zip Co (ASX:Z1P) share price make it a takeover target? Check out Ben Thompson's piece from this morning in Stratechery for more on why 1+1+1=3 in this acquisition, and the network effects for Square's business that can make this an even more . * And right now, Scott thinks there are 5 stocks that are better buys. Square stock is a 'must own' given long growth runway ... Unjust: Social Justice and the Unmaking of America Marty Shtrubel. "We. BNPL companies work differently from traditional credit companies. D Get tech and business insights, breaking news, and expert analysis delivered straight to your inbox. Square sees an opportunity to invest behind Afterpay's strong unit economics as well as attractive growth synergies, including the opportunity to introduce offerings and drive incremental growth for sellers and increased engagement for Cash App customers. Read the full Square press release here. Conservative Liberalism, Ordo-liberalism, and the State: ... Square Stock at $371 a Share? This Analyst Thinks It's ... At the time of writing, shares…, November 19, 2021 | Authorised by Bruce Jackson. He is also the co-founder and CEO of Twitter. Buy now pay later (BNPL) player Afterpay said features . "The complementary nature of the two businesses presents an opportunity to grow both organisations via strategic synergies and deepen the relationships between merchants and customers," she . As reported by WWD, Square Inc. revealed it has reached a deal with Afterpay Ltd. to acquire the buy now, pay later company for $29 billion in an all-stock deal this weekend. For more information please see our Financial Services Guide. The traditional world of payments, remittances, and how money flows through the economy is changing. Join Our Premium Community Afterpay Ltd (ASX: APT), the…, November 24, 2021 | While any move to bring this platform into the equation would not be seen a positive by the U.S. regulators at the moment, you can be sure that Dorsey is looking at the long-term horizon and moving the pieces on the chess board to position both Square and Twitter for long term success. The release stated that Square shareholders had approved the issuing of Square Class A common stock to Afterpay shareholders — marking a major milestone in the deal process. The author does not hold any equity positions with any company mentioned in this article. Once Cash App integrates with Afterpay, the former's installed base of more than 70 million active customers will be able to pay their installments, shop across a range of stores, send money to friends, unlock exclusive discounts, invest in stocks, and plenty more, all from a single destination. These cookies will be stored in your browser only with your consent. It will be interesting to watch how Apple in particular responds on their own online store given that the purchase of new iPhones is an obvious purchase candidate for BNPL, or whether Apple continues to partner with Affirm as it is doing in Canada. The news: US-based Square plans to acquire buy now, pay later (BNPL) provider Afterpay in an all-stock deal worth about $29 billion.The deal, which is slated to wrap up in Q1 2022, calls for Australia-based Afterpay to be integrated into its Seller and Cash App operations.. More on this: Square believes the merger will produce several product-line synergies that it can deliver to its merchant . In fact, even amid a crowded market with dozens of global competitors, Afterpay grew its merchant base 78% in fiscal 2021. Under Australia’s National Consumer Credit Protection Act, credit is defined as a method of paying for goods with the credit provider making their profit through charging interest. SAN FRANCISCO & MELBOURNE, Australia, August 01, 2021--Square, Inc. (NYSE: SQ) and Afterpay Limited (ASX: APT) today announced that they have entered into a Scheme Implementation Deed under which Square has agreed to acquire all of the issued shares in Afterpay by way of a recommended court-approved Scheme of Arrangement. Sign Up for Take Stock Square Announces Afterpay Acquisition, Potentially Disrupting Everyone. Square sees an opportunity to invest behind Afterpay's strong unit economics as well as attractive growth synergies, . Additionally, Square can integrate Afterpay into its various merchant checkout solutions, granting the latter access to new potential customers as well. Based on Square stock's closing price on July 30, the deal is valued at about $29 billion -- or 42 times Afterpay's trailing 12-month revenue. Square CFO discusses strength of small and medium-sized businesses, synergies with Afterpay Square Chief Financial Officer Amrita Ahuja appeared on Tuesday's episode of "Mad Money." 4 days ago - CNBC Television Square Earnings: Cash App, Seller and Afterpay Under the Spotlight. The book is also the story of a young woman who sought to make her professional mark while trapped in a failing marriage, buffeted by sexist preconceptions, and harboring secrets of her own. Australia’s largest bank announced it would pay merchants (rather than charge them) a 4% commission for sales using StepPay during the Christmas period. . Square and Afterpay Have Huge Synergies — and Dorsey Has a Plan. B And by spent, I mean diluted it's share holders in an all stock deal. And Dorsey’s Square is at the epicenter of this transformation — clearly looking to be a disruptive force for the little guy in the world of finance. When the Square/Afterpay combination was announced, the market was largely excited and pleased. The Afterpay model is innovative, in that the vast majority of its revenue comes from fees charged to merchants. Afterpay chairman Elana Rubin says the listed buy now-pay later market darling is "not anti-regulation" ahead of moves by Reserve Bank to regulate the sector. Last month, the RBA said it wants . the perceived synergies and other benefits of the pending transaction between Square and Afterpay; the ability of the transaction to accelerate growth and to strengthen the integration between Square's Seller and Cash App ecosystems; buy-now-pay-later Over the past few years, the increasing success of the Cash App has been Square's ( SQ) biggest growth driver. Afterpay has a strong footprint in the Asia Pacific (46% of LTM revenue). ET Afterpay offers installment payments for both e-commerce and brick-and-mortar lending. P Cash App should reap big benefits from the Afterpay integration. H ASX 200 The companies have published a presentation to provide an . With the acquisition . In Afterpay’s case, it is reportedly working on adding mortgages and other loans by partnering with Westpac Banking Corp (ASX: WBC). This model is designed to help people buy what they want, when they want it, in a responsible way without incurring interest, fees, or revolving debt. Afterpay is one of the category leaders in the buy now, pay later (BNPL) industry. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. Win at Retirement The analyst anticipates Seller gross profit to increase by roughly 50% year-over-year with "strong upside potential . Does this mean we can expect acquisition activity where a pure play challenger bank and a well-established BNPL player could start to look appealing? There are numerous potential synergies, given the importance of Cash to Square's overall business. Square, with a market cap of about $123 billion at the end of last week, may pay 1% of its buyout offer in cash, but the rest will be in stock, giving Afterpay shareholders 0.375 shares of Square for each Afterpay ordinary share. This was especially true during the pandemic when the peer-to-peer offering grew at . Dark Money is an essential book for anyone who cares about the future of American democracy. National Book Critics Circle Award Finalist LA Times Book Prize Finalist PEN/Jean Stein Book Award Finalist Shortlisted for the Lukas Prize Background The Afterpay Board unanimously recommends that Afterpay shareholders vote in favour of the Scheme of Arrangement with an offer of 0.375 shares of Square common stock for each Afterpay . "We see a long runway for share gains in [Square's] Seller [unit], view Cash App as the leader within the crowded neo-bank category, and see potential for Afterpay synergies to be 12% . Square will use Afterpay to expand internationally. The addition of Afterpay to Cash App will fortify the company’s growing networks of consumers around the world, while supporting consumers with flexible, responsible payment options. statements regarding the future performance of Square and Afterpay, the perceived synergies and . Square lists 70 million active Cash App users who, during the pandemic, have used the platform extensively, including cryptocurrency trading, expanding its use base beyond the micro-merchants transacting on the platform. Accordingly, when Square reports 3Q21 earnings today after the close, Deutsche. Examples of forward-looking statements in this communication include, among others, statements regarding the future performance of Square and Afterpay, the perceived synergies and other benefits . Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. Synergies. That product would be like savings and deposits, and broadening it from a single Buy Now, Pay Later company. The threat of a cashed up rival bidder - which some say may have been PayPal - spurred Square to strike its $39 billion deal with Afterpay early last month, a new regulatory filing by Jack . fewer returns, which is a win/win/win for customers, merchants, and Square. It also affords the merchants who buy the service from Square the opportunity to offer new ways to serve their customers. Square is acquiring Afterpay for $29b as it sets its sights on the BNPL market with significant integration opportunities. Over the past few years, the increasing success of the Cash App has been Square's (SQ) biggest growth driver. Brooke Cooper, With Afterpay Ltd (ASX: APT) readying itself to merge with Square Inc (NYSE: SQ) and (mostly) leave the ASX, Zip…, November 23, 2021 | The First All-Fintech Megadeal: Square is Buying Afterpay. On Thursday last week, in an ASX announcement, Afterpay revealed a step forward in the company’s move to be acquired by Square. While the Afterpay Ltd (ASX: APT) share price has fallen 5% in the past 5 days, its likely acquirer has been touting the magnitude of its potential. Cash, which got its start as a peer-to-peer transfer app, now accounts for more than 80% of Square's revenue due to its use for bitcoin trading. Could the Afterpay (ASX:APT) share price be about to get a boost? Square’s acquisition of Afterpay is another step on this journey of providing the capabilities often only enjoyed by larger retailers to the masses. X. 02:15. Nonetheless, Afterpay’s expansion into more financial products could offer Square a way of grabbing market share in personal finance. But it's not just the core BNPL technology that attracts merchants and consumers. What are banks thinking of the entity created by the Square Afterpay acquisition? It is mandatory to procure user consent prior to running these cookies on your website. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show and premium investing services. The Silicon Valley celebrity celebrated the acquisition, saying it would enable strong synergies between the two ventures. Square Inc., the digital-payments platform led by Twitter Inc. founder Jack Dorsey, agreed to buy Australian buy-now, pay-later company Afterpay Ltd. for US$29 billion in its largest-ever acquisition. We won't track your information when you visit our site. "Square's listing on the ASX is a huge win for local investors and will provide easy access to a high quality, innovate technology business. Afterpay’s 96,000 merchants worldwide will also bring value to Square’s online merchant presence with a typically larger and different type of merchant. I agree. However, Afterpay does not charge end consumers interest. What’s ahead for Square? Full of interesting stories and quirky facts - from the islanders who used huge stones as a means of exchange to the merits of universal basic income - this is an indispensable handbook for anyone curious about how money came to make the ... SAN FRANCISCO & MELBOURNE, Australia, August 01, 2021--Square, Inc. (NYSE: SQ) and Afterpay Limited (ASX: APT) today announced that they have entered into a Scheme Implementation Deed under which Square has agreed to acquire all of the issued shares in Afterpay by way of a recommended court-approved Scheme of Arrangement. With Square’s bank charter, over time more banking and financial services capabilities will likely extend the functionality of this network for consumers and merchants and grow exponentially as network effects kick in. The company also serves as a central e-commerce hub, or a sort of digital mall, for shoppers and sellers alike. Over the past few years, the increasing success of the Cash App has been Square's (SQ) biggest growth driver. This website stores cookies on your computer. CHOSEN AS A BOOK OF THE YEAR BY NEW STATESMAN AND BBC HISTORY MAGAZINE 'In this searing book, Priya Satia demonstrates, yet again, that she is one of our most brilliant and original historians' Sunil Amrith, author of Unruly Waters For ... This virtuous circle will attract more merchants to the platform, which will attract more consumers, and so on. Investors won't be able to truly determine whether Square underpaid or overpaid until long after the acquisition closes. To add what PayPal did on a whim 3 quarters ago without dropping a dime. As for Cash App, the synergies are pretty . Square, Afterpay, their respective directors and certain of their executive officers and other employees may be deemed to be participants in the solicitation of proxies from Square's security holders in connection with the proposed transaction. In addition, Afterpay will reinforce the connections between Cash App and Seller ecosystems, accelerating the company’s ability to offer a full suite of commerce capabilities to Cash App customers. Afterpay sees 'synergy' with Square-owned Cash App. Sebastian Bowen, It remains one of the biggest investing stories of the year in 2021 so far. Here’s how the company is pushing for carbon neutrality. These players now face a more challenging and unexpected competitor in the combined Square/Afterpay. To make the world Smarter, Happier, And Richer. This book reviews recent trends and developments in the study of the impact that the environment has on human reproduction. While the $29 billion headline looks a lot, and certainly represents the largest ever acquisition of an Australian listed company, we need to look deeper. Mitchell is now completing his studies in finance and wealth management and hopes to help others in their investing journey. For example, Paypal Holdings Inc (NASDAQ: PYPL) is not giving up the payments market share without a fight. Before you consider Afterpay, you'll want to hear this.
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