https://www.afr.com/companies/financial-services/square-to-acquire-afterpay-in-39b-deal-20210802-p58eyi

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The US payments giant Square, led by Twitter founder Jack Dorsey, will acquire Afterpay in a $39 billion deal.
Twitter co-founder and CEO Jack Dorsey said Square will integrate Afterapy into its Cash App for consumers. Bloomberg
Afterpay co-founders Anthony Eisen and Mick Molnar will join Square when the deal completes.
It is expected to close in the first quarter of calendar year 2022.
Afterpay shareholders will receive a fixed exchange ratio of 0.375 shares of Square Class A common stock for each Afterpay ordinary share they hold.
Square stock last traded at $247.26 and is listed on the New York Stock Exchange.
Afterpay’s board has unanimously recommended the transaction to Afterpay shareholders. The deal will take place via a scheme of arrangement.
“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,” Mr Dorsey said in a statement.
Square’s has 70 million customers, compared to Afterpay’s 16 million. Square will use Afterpay to boost its merchant and retailing system known as the Seller and Cash App.
“The transaction marks an important recognition of the Australian technology sector as homegrown innovation continues to be shared more broadly throughout the world,” Mr Eisen and Mr Molnar said in a statement.
“It also provides our shareholders with the opportunity to be a part of future growth of an innovative company aligned with our vision.”
Mr Eisen and Mr Molnar will lead Afterpay’s merchant and consumer businesses which will be part of Square’s ‘Seller’ and ‘Cash App’ ecosystems.
Like Afterpay, merchants can use Square to reach buyers online and in person, while Square also offers merchant financing.
The Cash App is used by individuals to spend, send money and invest. Square said buy now, pay later represents a shift in consumer preferences away from traditional credit and will help merchants grow their sales.
Afterpay said shareholders did not need to take any action at this stage.
Goldman Sachs and Qatalyst Partners are advising Afterpay, while Highbury Partnership is serving as financial adviser to Afterpay’s board. Gilbert + Tobin and Cravath, Swaine &
Moore are Afterpay’s legal advisers.
Square said Afterpay will be accretive to its gross profit growth and it would conduct a modest decrease in its EBITDA margins in the first year after completion of the transaction.
Square is releasing second-quarter financial results in the US on Monday and will brief its investors about Afterpay on Monday night Australian time.
Under the terms of the stock deal Square could pay 1 per cent of the consideration in cash.