Square to Acquire Australia’s Afterpay for $29 Billion. Its Stock Is Dropping.

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By Liz Moyer

Updated Aug. 2, 2021 7:35 americium ET / Original Aug. 1, 2021 6:51 p.m. ET

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The Square Inc. Point of Sale exertion is seen successful the App Store connected an Apple Inc. iPhone

Photograph by Andrew Harrer/Bloomberg

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The integer payments app Square plans to get Australian installment payments institution Afterpay for $29 cardinal successful stock.

The all-stock woody volition assistance the fintechs widen their lawsuit bases and thrust gross for merchants, the companies announced connected Sunday. Afterpay offers consumers an alternate to a recognition paper to marque purchases that tin beryllium paid implicit time.

Square (ticker: SQ) volition fold Afterpay ‘s (ASX: APT) “buy now, wage later” exertion into its Cash App and Seller systems, enabling adjacent tiny merchants to connection the bargain now, wage aboriginal enactment astatine checkout.

The companies expect the woody to adjacent by the archetypal 4th of adjacent year.

Square co-founder and CEO Jack Dorsey, who is besides a laminitis and the CEO of Twitter (TWTR), said successful a statement: “We built our concern to marque the fiscal strategy much fair, accessible, and inclusive, and Afterpay has built a trusted marque aligned with those principles.”

Dorsey added the transportation volition “deliver adjacent much compelling products and services for merchants and consumers, putting the powerfulness backmost successful their hands.”

As of the extremity of June, Afterpay much than 16 cardinal consumers and astir 100,000 merchants worldwide arsenic customers, including large retailers successful fashion, homewares, beauty, and sporting goods segments.

In announcing the deal, Square said that bargain now, wage aboriginal offers an “attractive accidental supported by shifting user preferences distant from accepted credit, particularly among younger consumers, accordant request from merchants for caller ways to turn their sales.”

Square banal has dropped 4.6% to $236 successful premarket trading Monday.

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