The digital-payments platform Square will purchase the buy now, pay later firm Afterpay in Australia’s largest-ever buyout.
The move will create a giant in the explosive no-credit-checks online payments sector for a cost for $29 US billion dollars.
The payments firm of Twitter co-founder Jack Dorsey has paved the way for the niche purchasing model of allowing shoppers to repay in interest-free installments, bypassing credit checks.
The concept gained popularity last year as more people, especially the young, chose to pay for products in installments.
Afterpay’s board has unanimously recommended the deal to its shareholders, according to a joint statement.
The all-stock buyout would value the shares at $92 US dollars, the companies said in a joint statement.
The loose regulation and quick uptake among users has led to rapid growth in the sector.
Square Chief Executive Jack Dorsey said about the expected buyout, "Square and Afterpay have a shared purpose ... Together, we can better connect our Cash App and Seller ecosystems to deliver even more compelling products and services for merchants and consumers.”
The deal provides an opportunity for Afterpay to expand in the U.S., where its sales there nearly tripled in 2021.
Afterpay’s success has reportedly inspired Apple to provide a similar service, allowing shoppers to pay for products over time, rather than in a lump sum upfront.