The Afterpay Ltd (ASX: APT) share price is under pressure today following the company's latest update.
In early trade, shares in the buy now, pay later (BNPL) business are down 5.32% to $100.83. The strain on Afterpay's shares follows a 6.6% fall in the value of US payments giant Square Inc (NYSE: SQ) overnight.
Only yesterday, my colleague Sebastian recapped the hoops left for the two companies to jump through before being united. Well, Afterpay's update this morning indicates it has hit a snag along its path to acquisition completion.
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What is pulling the Afterpay share price down today?
Afterpay investors are mimicking the disappointing performance of Square last night, following the company's announcement of a name change to Block. While the US giant's price slump might have been related to its new branding, Afterpay has its own update today.
The Aussie BNPL company has provided an update on the takeover scheme of arrangement and upcoming scheme meeting. According to its release, Afterpay has now satisfied all regulatory conditions. However, the 2 companies are still waiting on approval from the Bank of Spain.
Both Afterpay and Square expect to eventually meet the Bank of Spain condition. However, Square is estimating the condition will be satisfied in mid-January 2022. Because of this, the Aussie company has opted to delay the scheme meeting, which was set for 6 December.
At this stage, it looks likely the meeting will be put back until the new year. Furthermore, the company will approach the NSW Supreme Court to approve new materials containing the updated scheme meeting details.
The Afterpay share price has weakened on the news today. It is difficult to decipher whether this is directly due to the regulatory delay or because of the fall in Square shares overnight.
What has been completed?
In terms of progress, it's not all bad news. So far, the proposed takeover has ticked a number of boxes. Importantly, there has been regulatory approval from the Australian Foreign Investment Review Board, New Zealand Overseas Investment Office, and Spain FDI Authority.
Additionally, the proposed deal has obtained the approval of Square shareholders. Likewise, the new Square shares to be issued have also received the thumbs up. Essentially, the last piece of the puzzle is satisfying the Bank of Spain condition.
The Afterpay share price has fallen 12.2% since the Square takeover was announced on 2 August.
