MoneyGram has pushed back the expected date of its planned sale.
The firm and the intended buyer, venture capital firm Madison Dearborn Partners (MDP), now expect to close the merger “late in the second quarter of 2023,” MoneyGram said in its quarterly report released Friday (April 28).
MoneyGram had said in an update on the planned sale released in January that the closure of the merger transaction with MDP was expected at the end of the first quarter or early in the second quarter.
In its quarterly report released Friday, the company attributed the delay to its waiting for final regulatory approval by the Reserve Bank of India (RBI), which is the issuer of MoneyGram’s Money Transfer Service Scheme (MTSS) license in India.
“Since the company and MDP signed the merger agreement, the RBI issued a new circular covering approval requirements related to Payment System Operators (PSO) such as the company,” MoneyGram said in its quarterly report. “The merger will be one of the first PSOs undergoing a sale since the circular was issued. As a result, the process has been taking longer than originally anticipated. MoneyGram continues to engage in active dialogue with the RBI and the Central Government of India regarding its review of the merger.”
As PYMNTS reported Wednesday (April 26), investors were already feeling uncertain about MoneyGram as they waited for an update on the status of the planned sale.
MoneyGram announced the planned acquisition by MDP — for $1.8 billion — in February 2022.
“By partnering with MDP and becoming a private company, we will have greater opportunities to innovate and transform MoneyGram to lead the industry in cross-border payment technology and deliver a more expansive set of digital offerings, while leveraging our global platform for new customers and use cases,” MoneyGram CEO and Chairman Alex Holmes said at the time.
As PYMNTS reported at the time, MoneyGram had become an acquisition target amid competition from firms such as Remitly and Revolut, which had hindered the company’s ability to capitalized on the payments and remittances space.