Aussie BNPL Zip closes $296m acquisition of US player QuadPay
Australian buy now, pay later (BNPL) fintech Zip has completed an AUD 403 million ($296 million) acquisition of US competitor QuadPay.
The Afterpay rival also recently landed an AUD 200 million funding deal with US investor Heights Capital Management.
This investment, following news of the acquisition in June, sent shares soaring more than 40%, according to The Sydney Morning Herald.
Zip is focusing a big part of its expansion efforts stateside, as rival Afterpay steps into Europe with its Spanish BNPL acquisition.
“The US is a critical part of our global strategy as merchants increasingly demand global payment solutions,” says Larry Diamond, Zip’s CEO and co-founder.
New York-based Quadpay allows customers to pay in four interest-free instalments over six weeks, either online and in-store.
In August, Quadpay reported a record month. Monthly transaction volume exceeded $70 million. That’s a 30% uptick on the June average, and a 600% uptick on July 2019 figures.
“QuadPay’s business has continued to deliver strong results, driven by the flight to online and a move away from the outdated and unfair credit card,” Diamond adds.
New Zealand, the UK and South Africa
In September 2019, Zip bought PartPay, a New Zealand-based BNPL firm, for around NZD 50 million ($32 million).
The acquisition saw Zip pick up its initial 15% stake in QuadPay. The latest acquisition sees it seal the remaining 85% stake.
PartPay also secured Zip’s presence in the UK, as well as New Zealand. And it saw Zip take a 25% stake in South Africa’s Payflex.
The bumper acquisition – finally seeing completion – seems to be integral to the Aussie start-up’s expansion plans.
According to Zip, figures based on the March quarter for Zip, QuadPay and its other BNPL operations, reached an annual revenue of AUD 250 million.
They also point to a total of 3.5 million customers, and 26,200 merchants.
Zip has also completed the issuance of AUD 100 million in convertible notes. That’s alongside up to AUD 100 million of warrants to CVI Investments to drive global growth.
CVI Investments is part of the US-based investment firm, Susquehanna International Group.
“We are also delighted to welcome Susquehanna Investments Group onto the register and thank them for their support as we turbocharger our growth into new products and geographies,” says Diamond.