Afterpay launches Europe push

The aggressive buy now, pay later provider is not showing any signs of slowing down.

Nick Molnar, CEO of Afterpay at Bondi Beach. John Feder/The Australian.

Buy now, pay later market darling Afterpay is ramping up its global push, this time expanding into the lucrative €300b1 ($494bn) European buy now, pay later market through the acquisition of Pagantis and PMT Technologies.

Fresh off forays into the UK, Canada and the US, Afterpay said it would now take on the likes of Spain, France, Italy and Portugal.

In a statement, Afterpay said its subsidiary Clearpay would acquire Spanish tech outfit Pagantis. Pagantis’ products will be rebranded to Clearpay, and legacy technology from Pagantis will be integrated to provide the Afterpay core product.

Afterpay CEO Anthony Eisen said the company’s growth in the UK and the US had been faster than anticipated.

“Our momentum to date has given us the confidence to expedite our expansion into new global regions,” Afterpay chief executive Anthony Eisen said. “Entering into such internationally relevant markets like the US and the UK and seeing our growth outpace what we experienced in our more mature Australian market, validates the appeal of our product on a global scale.

“The new markets we will be entering will provide our global retailers with the opportunity to offer Afterpay in more regions and for us to provide a whole new customer base with access to our differentiated and customer centric model.”

NBQ will receive €50m ($82.3m) in consideration as part of the deal, with €5m to be paid at the conclusion of the deal and the remainder payable three years after the conclusion of the deal.

The deal is set to close by December 2020 subject to regulatory approval, and once finalised will give Afterpay access to all core-European markets due to banking license passporting rules.

Pagantis has approximately 1400 merchants and 150,000 customers. Existing Pagantis credit card and consumer fee instalment products will be discontinued, with the existing loan book to be retained by NQB Corporate SLU.

Royal Bank of Canada analyst Tim Piper said the expansion move meant ‘Europe ticked.’

“With European entry flagged as APT’s next entry, point, we are of the view that the acquisitive path positions APT well into a more effective, faster and less riskier roll out in Europe,” Mr Piper said.

“We see as key gaining access to Pagantis’s credit license which provides access to multiple key markets in Europe with the investment flagged as well absorbed into APT’s cost base.”

The company maintained its price target for Afterpay shares of $63.

Afterpay shares last traded at $78.95 each, double their highs around $39.44 hit prior to the sharemarket’s collapse in March.