Square to buy installment payment firm Afterpay in $29B deal

Digital payments company Square Inc. says it has agreed to acquire Afterpay, which provides a “buy now, pay later’’ option for merchants, in an all-stock deal valued at about $29 billion.

Square said Sunday it has agreed to buy all of the Australian company’s shares, and that the transaction’s estimated value is based on last Friday’s closing price of Square common stock.

San Francisco-based Square, which processes credit card transactions via devices that plug into mobile devices like tablets or smartphones, said it aims to broaden access to more consumers with the acquisition, which is expected to close in the first quarter of 2022.

The company plans to integrate Afterpay into its services, enabling merchants to offer customers the option to pay for goods later without relying on a credit card. Afterpay users would be able to manage their installment payments directly in Square’s cash app.

“Together, we can better connect our cash app and seller ecosystems to deliver even more compelling products and services for merchants and consumers, putting the power back in their hands,” Square CEO Jack Dorsey said in a statement.

As of June 30, Afterpay was serving more than 16 million users and nearly 100,000 merchants, including major retailers, the company said.