In an ASX listing on Monday, Zip confirmed it has entered into a definitive agreement to acquire Sezzle in an all-scrip transaction by way of a statutory merger.
Zip said the deal values Sezzle at $491 million, a 22 per cent premium based on current spot prices of the pair’s ASX-listed shares.
According to the buy now, pay later provider, the proposal has been unanimously approved by both companies’ board of directors.
Zip also announced a $148.7 million placement and a $50 million share purchase to help strengthen its balance sheet and enable sustainable growth.
“We are delighted to be bringing Zip and Sezzle together under a transformational transaction that is expected to deliver immediate scale and enhanced growth, which will support our path to profitability,” said Larry Diamond, co-founder and global CEO of Zip.
“Combining with Sezzle positions us as a leading global BNPL provider and prioritises our ability to win in the important US market.”
Closing of the proposed transaction is expected to occur by the end of the third quarter of CY2022. When completed, Zip shareholders would own approximately 78 per cent of the combined group while Sezzle shareholders would own the remaining 22 per cent.
The combination of Zip and Sezzle is expected to result in pro forma 8.8 million customers and 60,500 merchants in the US.
Also on Monday, Zip confirmed record group revenue of $302.2 million, up 89 per cent year on year.
