- Western Union CEO Hikmet Ersek is eyeing up acquisition targets.
- Positive earnings reports have left the firm in the perfect position for expansion.
- Talks of a MoneyGram acquisition have still not been confirmed by the CEO.
According to a report in the Financial Times, the CEO of Western Union, Hikmet Ersek, has teased plans that the global payments company is on the lookout for potential merger targets.
This news comes even as many countries around the world are facing a huge amount of economic uncertainty arising from the COVID-19 pandemic.
However, Ersek disclosed in an interview with the Financial Times that he was using this period of uncertainty to acquire weaker rivals.
While this might seem like an unusual time to be eyeing up expansion opportunities, with many companies across the world announcing mass layoffs in response to the pandemic, according to Ersek, this is the perfect time for Western Union to look to expand.
The international payments giant has managed to keep its company balance sheets in good health, with cash flow through the business in an even better position.
This has given the Western Union company executives a confidence boost as they begin to identify targets for a potential acquisition.
According to a report in Bloomberg last month, one of the potential targets that Western Union has been flirting with is MoneyGram, which is an international transfer company based in Dallas, Texas, though the Western Union CEO declined to confirm or deny this claim.
MoneyGram is one of Western Union’s main rivals, and its market valuation of $220m pales in comparison to Western Union’s $9.6bn, making the firm a perfect target for acquisition.
Despite admitting that the firm was looking to expand its operations through an acquisition, Ersek did appear quite tentative about when this might happen, particularly with so much uncertainty still surrounding the COVID-19 pandemic.
On this basis, it seems that while the firm is in a good position to undertake such an acquisition, it is not going to rush into a tie-up for the sake of expansion.
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