Alibaba's Ant Financial buys MoneyGram for $880m

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Alibaba's Ant Monetary buys MoneyGram for $880m

  • 27 January 2017
  • From the part Business
A sign showing the Alibaba groupPicture copyright Reuters

Ant Monetary, the digital funds arm of e-commerce big Alibaba, is shopping for US-based MoneyGram for $880m (£700m).

MoneyGram has about 350,000 retailers in almost 200 nations. Ant Monetary has greater than 630 million customers.

The takeover by the Chinese language group will want regulatory approval from the US Committee on Overseas Funding.

The inter-agency committee critiques overseas acquisitions of home American belongings on grounds of nationwide safety.

Eric Jing, chief government at Ant Monetary, stated in a statement that the wedding of the 2 corporations will "present higher entry, safety and ease for individuals all over the world to remit funds, particularly in main economies comparable to the USA, China, India, Mexico and the Philippines".

Ant Monetary has an enormous market share within the on-line funds business in China. The acquisition might assist the corporate prolong the lead in addition to increase abroad, as competitors is rising in China with rival Tencent's WeChat cost system.

US-listed Moneygram's shares rose by almost 9% on the information. The takeover has been accredited by MoneyGram's board of administrators.

Politics over income?

Ant Monetary's purchasing spree within the US comes towards a backdrop of rising tensions between China and the world's largest financial system.

Earlier than he took workplace, then president-elect Donald Trump was questioning whether or not the US ought to proceed its "One China" policy, sparking fury from Chinese language state media. And through his presidential marketing campaign, Mr Trump threatened to impose punitive tariffs on Chinese language imports.

However Jack Ma, the founder and chairman of Alibaba, held a gathering with Mr Trump in December final yr.

Whereas President Trump has been essential of China, he stated he had a "nice assembly" with Mr Ma, who selected to drift Alibaba on the New York Inventory Change. The share sale in September 2014 was a record-breaker, as Alibaba raised $25bn in its preliminary public providing.

If the MoneyGram deal goes by means of, it is going to be Alibaba's second acquisition within the US. Final yr the e-commerce big bought EyeVerify in a $70m deal.

EyeVerify is a start-up based mostly in Missouri, which makes use of biometric authentication know-how for securing consumer's on-line knowledge and transactions.

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