- Sendwave caters to the African market and will now be purchased by WorldRemit.
- The new deal is believed to be worth around US$500m and will push the combined value of the firms to approximately US$1.5 bn.
- A senior figure at WorldRemit predicted that the firms would soon be in the same league as the likes of PayPal.
International money transfers firm WorldRemit has announced that it will purchase a smaller firm aimed towards customers in Africa.
WorldRemit said that it had snapped up Sendwave in a deal designed to meet the increasing demand for digital remittances caused by the coronavirus pandemic.
Sendwave, which has been supported and invested in so far by the major start-up incubator Y Combinator, focuses largely on the African market.
It permits individuals in Western markets such as Europe and the US to make real-time transfers to Sub-Saharan African nations such as Ghana.
Even though the acquisition is going ahead, Sendwave will be permitted to operate autonomously, as it does currently.
The deal is understood to be worth around US$500m.
The value of the deal is believed to be partly in stock and partly in cash.
Overall, the new firm is expected to be worth in the region of US$1.5bn.
It is understood that these particular financial details were not published by WorldRemit but they were shared by a person familiar with the deal.
However, a senior figure from the firm did give an interview that shed more light on the wider context of the acquisition.
Breon Corcoran, who serves as WorldRemit’s chief executive officer, said that the acquisition of Sendwave was coming against a backdrop of a coronavirus-fuelled shift in favour of digitalisation in financial services.
“What we saw immediately after lockdown orders is a real acceleration toward digital,” he was quoted as saying.
He also shared some bold predictions about the sort of companies that the firms might increasingly become compared to as time goes on.
“This is a fast-growing part of the broader payments space and increasingly our businesses will be viewed as more akin to Venmo or PayPal,” he said.
Market watchers will be interested to see Breon Corcoran’s striking claim that WorldRemit will, over time, be able to be seen in the same league as PayPal.
He is not wrong that the world is becoming more digitalised, and payments services are no exception.
If you would like to know more about WorldRemit and the cross-border payments services it offers, why not check out our review of the broker here?
