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The acquisition of US buy now, pay later (BNPL) firm Sezzle by Australian rival Zip has been called off, with both firms mutually agreeing to terminate the deal.
Zip and Sezzle mutually agreed to terminate the deal
The merger was initially announced earlier this year with Zip looking to boost its global expansion plans, in particular its foray into the US market.
However, in an announcement made to the Australian Securities Exchange (ASX), Zip cites “current macroeconomic and market conditions” as a reason behind the termination.
Despite this, the firm adds the US “remains a core market and area of focus, and a significant opportunity for the business”.
As part of the agreement to break off the merger, Zip will pay Sezzle $11 million (AUD 16 million) to cover costs associated with the deal, including legal and accounting costs, among other things.
Diane Smith-Gander, chair of the board at Zip, says: “We believe that mutually terminating the merger agreement with Sezzle at this time is in the best interests of Zip and its shareholders, and will allow Zip to focus on its strategy and core business in the current environment.”
Earlier this month, Business News Australia reported that Zip is set to shutter its money management app Pocketbook, while Sky News reported last week that the firm is looking to exit the UK after only starting operations in the country just over a year ago.
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Image and article originally from www.fintechfutures.com. Read the original article here.