The Western Union Company (NYSE:WU) agreed to acquire a 15% stake in a Saudi Arabian digital payment business for up to $200 million.
WU entered over the weekend into a definitive agreement to acquire a minority stake in fast growing Saudi Digital Payments Company, or stc pay , a fully-owned subsidiary of Saudi Telecom Company. According to the terms of the transaction, Western Union will invest up to $200 million for up to 15% ownership of stc pay. In conjunction with the investment, the companies extended the terms of their commercial relationship.
stc pay has rapidly developed into a leading digital wallet service in Saudi Arabia, a young and quickly developing market which offers huge potential for digital services. With a strong base of over four million customers and an established regional brand in the fast-growing digital wallet market, Western Union believes that stc pay is poised to experience strong growth in the future.
Western Union operates a strong and resilient global business across digital and retail channels. The Company has achieved significant progress in its digital growth strategy in 2020 through both its market leading westernunion.com channel and digital partnerships.
In the third quarter of 2020, digital revenues increased 45% year-over-year, representing 21% of Western Union’s consumer business, and trended at an annual rate of over $900 million.
The Company currently partners with stc pay, providing money transfer services that allow stc pay’s users to send money from its app to 200+ countries and territories in 130+ currencies through Western Union’s extensive global network of accounts, wallets, cards and retail.
WU shares began Monday up 51 cents, or 2.4%, to 21.41
