Ant Financial’s proposed takeover of MoneyGram will be a “win-win” for both parties, as they could leverage respective strengths to create an improved payment environment, the chief executive of the U.S. payments company told CNBC on Tuesday.
Ant, the payments affiliate of Chinese e-commerce giant Alibaba Group Holding, hiked its bid for MoneyGram by 36 percent to $18 per share in cash, valuing the company at $1.2 billion and sending shares of the U.S. firm to a three-year high on Monday.
“They are looking at creating, really, a financial inclusion ecosystem that creates better access for all people to financial services. They offer credit, they offer payment mechanisms, they offer a fantastic application, but they don’t have that cross-border remittance capability, so putting the two companies together is win-win for both,” MoneyGram CEO, Alex Holmes, told CNBC’s “Squawk Box“.
For MoneyGram, the deal will help accelerate investments into digital platforms “that are going to be so important for our customers in the future,” Holmes added. About 15 percent of the U.S. company’s revenue now comes from digital channels.
There are already 650 million using Ant Financial’s Alipay mobile wallets so “the ability to add MoneyGram to that and to put our name front and center on their mobile application is just a huge opportunity for growth,” he said.
MoneyGram provides services in 350,000 locations across 200 countries. Its global remittance channels for sending money overseas would help Ant build a cross-border network. This comes after a recent spate of investments in Asia for Ant.
