Ant Financial, the digital payments arm of Chinese e-commerce giant Alibaba, is buying Dallas-based MoneyGram in a deal worth $880 million.
The major tie-up will bring together MoneyGram’s 350,000 outlets across 200 countries with Ant Financial’s 630 million users.
It comes as part of Alibaba’s plan to expand further outside of China, with CEO Jack Ma setting the goal of achieving half its sales from the rest of the world. Currently, sales from outside of China account for around 16 percent and have held steady for the past four years.
“The acquisition of MoneyGram is a significant milestone in our mission to bring inclusive financial services to users around the world,” said Eric Jing, Chief Executive Officer of Ant Financial said in a statement.
Upon completion of the transaction, MoneyGram will retain the MoneyGram brand name and management team. Alex Holmes will continue to serve as Chief Executive Officer of MoneyGram and MoneyGram will remain headquartered in Dallas, where it is is expected to maintain and grow its US-based workforce.
“This transaction will significantly benefit consumers throughout the world who depend on innovative and reliable financial connections to friends and family,” said Alex Holmes, Chief Executive Officer of MoneyGram.
“MoneyGram can now accelerate and expand our suite of global hybrid solutions and integrate an even larger digital and physical network, making money transfers easier for customers and providing a wider selection of services for the agents who serve them around the world.
The deal marks a significant tie-up between China and the US at a time when the future of their relationship hangs in the balance. Prior to entering office, US President Donald Trump questioned the US’ ‘One China’ policy and took a phone call with the President of Taiwan, prompting outrage from Chinese media.
However relations between Alibaba and Trump have been strong since the beginning, with Jack Ma meeting Trump in New York in December 2016 to discuss working together. Trump said he had a “great meeting” with Ma, who has chosen to float Alibaba on the New York Stock Exchange.