Euronet bugs Ant Financial with MoneyGram move
Payments firm Euronet has proposed to buy money transfer operator MoneyGram International for $15.20 per share – in turn becoming a pest to Ant Financial’s acquisition plans.
As Banking Technology reported in January, Alibaba’s affiliate Ant Financial planned to splash out $880 million for MoneyGram – its first acquisition of a US-listed company.
Euronet says its offer represents a roughly 15% premium over MoneyGram’s existing agreement with Ant Financial and a premium of approximately 28% to the company’s closing price on the day prior to the Ant Financial transaction announcement.
Michael Brown, chairman and CEO of Euronet, says its transaction “would not require a review” by the Committee on Foreign Investment in the United States (CIFUS).
He adds that MoneyGram’s handling and preservation of personal financial records of millions of US customers for ten years “could complicate CIFUS’s investigation and potential mitigation measures” and it “appears increasingly clear that many expect the review and investigation of the Ant Financial transaction to be substantial, adding significant uncertainty to its outcome”.
Euronet’s offer will value Moneygram at more than $1 billion, in addition to the assumption of approximately $940 million of MoneyGram’s debt outstanding.
MoneyGram enables consumers and businesses to send cash worldwide, generating revenue from transaction fees and spreads on foreign-exchange rates. It is one of the largest long-established players in the global remittance space alongside Western Union.
Whoever wins out of Euronet, Ant Financial or even a new bidder, they will still face increasing competition from the likes of WorldRemit, TransferWise, Xoom, TransferGo, TransferTo and a multitude of other digital newcomers.