News that PayPal is launching a buy now pay later offering in the fourth quarter of 2020 has overshadowed a positive announcement and is weighing on the Zip Co Ltd (ASX: Z1P) share price on Tuesday.
In morning trade the Zip share price is down 6% to $8.59.
What did Zip announce?
This morning Zip announced that shareholders voted overwhelmingly in favour of its acquisition of QuadPay at an extraordinary general meeting on Monday.
As a result, the acquisition has completed successfully along with the issuance of $200 million in convertible notes and warrants to CVI Investments.
Under the terms of the acquisition, the company has issued 118,776,189 fully paid ordinary shares to the QuadPay stockholders and granted 10,480,369 options to subscribe for new fully paid ordinary shares in the future.
What is QuadPay?
QuadPay is a growing US-based buy now pay later provider disrupting the credit card industry with a strong focus on innovation and customer centricity.
As with rival Afterpay Ltd (ASX: APT), it enables customers to pay in four interest-free instalments over 6 weeks for purchases made both online and instore in the $5 trillion dollar US market.
Zip's CEO and Co-Founder, Larry Diamond, was very pleased to complete the acquisition.
He said: "We are thrilled to welcome QuadPay to the Zip Family. The US is a critical part of our global strategy as merchants increasingly demand global payment solutions. The QuadPay business has continued to deliver strong results, driven by the flight to online and a move away from the outdated and unfair credit card."
"We are already working closely with the QuadPay team and expect to drive significant synergies as we come together to capitalise on the global opportunity. We are also delighted to welcome Susquehanna Investment Group onto the register and thank them for their support as we turbocharge our growth into new products and geographies," he concluded.
