Back
~
2
min read
· Posted on
February 21, 2024

Zip is buying US BNPL Sezzle

Ahh, so the rumours really were true. Combined, the new business will have around 13 million customers.

What's the key learning?

  • Zip has finally confirmed it'll buy US buy now, pay later firm Sezzle
  • Zip will need to raise $200 million via a share placement and share purchase plan to fund the acquisition
  • Unlike an IPO, placements are only offered to a small number of private investors.

Background: Zip is an Aussie buy now, pay later company that started back in 2013. And since 2020, it's been on a bit of an acquisition spree.

What happened: After months of spinning the rumour mill, Zip has finally confirmed it'll buy Sezzle. Combined, the new biz will have 13 million customers and 125,000 merchants. Sheesh!

What else: Zip will need to raise $200 million via a share placement and share purchase plan to fund the acquisition.

🔔 What's the key learning?

💡When a company wants to raise capital for an acquisition, it generally has two potential options. It can either borrow the money from a lender, or issue new shares in the company.

💡There are tonnes of ways to raise money on the sharemarket (i.e. IPO, rights issue, share purchase plan) and one of them is a placement.

💡Unlike an IPO, placements are only offered to a small number of private investors (i.e. investment banks, insurance companies). It generally comes without a prospectus, so it's cheaper - and quicker.

Ready to win at money?

Sign up for Flux and join 100,000 members of the Flux family

A button to App StoreGoogle Play store button
Excellent  4.9 out of 5
Star rating
No items found.