Ant Financial, the Chinese financial services affiliate of Alibaba, has inked a deal to acquire WorldFirst, the U.K. payments company.
According to a report in Bloomberg, this marks the biggest overseas deal for Ant Financial, which has been aiming to expand into the U.S. It is also the first big push by Ant to enter the U.K. market. Alipay, its digital payment service, is accepted at some merchants in the U.K., noted the report.
Under the terms of the deal, WorldFirst will remain an independent unit owned by Ant Financial. WorldFirst has around 600 employees, helping 160,000 people and small businesses transfer money. Since launching in 2004, the publication noted that the company has transferred $90 billion for customers.
“The products and services of Alipay and WorldFirst are highly complementary,” WorldFirst Chief Executive Officer Jonathan Quin said in a memo sent to clients and seen by Bloomberg. “All your current customer and account information will also remain unchanged.” Quin added that WorldFirst will maintain its brand under the deal.
According to another report, the deal is valued at roughly $700 million, which is in line with previous news reports that the two were talking about a deal valued at around $717 million. Alibaba hasn't announced the deal, but did confirm the acquisition to the publication via a spokesperson.
“The tie-up will add WorldFirst’s international online payments and virtual account products to Alipay’s range of technology solutions,” an Ant Financial spokesperson told the outlet, without providing details about the deal.
According to the report, the deal underscores how China and Europe are forging strong connections, as well as the struggles smaller payment companies face with big rivals like Amazon getting into the market in Asia. While WorldFirst was able to transfer $90 billion since its inception, it is under pressure, which is why landing a deal with Ant Financial was a priority. With Amazon going direct with its own service, the payment company’s margins are under pressure. “WorldFirst had recently seen low to declining growth because of this,” an unnamed executive operating in the remittance industry told the news outlet.