Afterpay grows in Europe via acquisition of Pagantis

Maria Nikolova

Afterpay’s subsidiary Clearpay EU has entered into a Share Purchase Agreement with NBQ Corporate SLU to acquire 100% of the shares outstanding in Pagantis SAU and PMT Technology SLU.

Afterpay Ltd (ASX:APT) is expanding into Europe via the acquisition of Pagantis.

Afterpay’s subsidiary, Clearpay (Europe) Limited has entered into a Share Purchase Agreement with NBQ Corporate SLU to acquire 100% of the shares outstanding in Pagantis SAU and PMT Technology SLU (collectively, Pagantis).

Pagantis currently provides a range of buy now, pay later and traditional credit services across Spain, France and Italy with regulatory approval to also operate in Portugal.

Following completion of the acquisition, Pagantis’ existing technology will be re-configured to provide the Afterpay core product, and the business will be rebranded to Clearpay, enabling an expedited launch into Spain, France, Italy and Portugal with local language compatibility. Pagantis’ existing consumer fee instalment and credit card offerings will be discontinued post completion of the acquisition.

Existing loan book will be retained by NBQ and is excluded from the transaction.

As part of the Agreement, NBQ will receive a minimum €50m in consideration (subject to customary adjustments), payable as follows:

  • Upfront Consideration – €5m in cash payable at completion; and
  • Deferred Consideration – €45m in cash, payable three years post completion. Deferred Consideration can exceed €45m, with any excess being payable in cash or Afterpay shares (at Afterpay’s election), provided the equity value of Pagantis exceeds €45m, 3 years post completion.

Completion of the acquisition is expected to occur in or before December 2020, subject to Bank of Spain regulatory approval to the proposed change of control.

Afterpay explains that its expansion into the EU is consistent with demand from its marquee global retailers. The ability to service Afterpay’s retailers in all their key markets strengthens its relationships and contributes to its competitive moat.

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