- Square’s takeover of Afterpay to complete on 18 January 2022
- Afterpay can exercise its call option early to buy out ThinkSmart’s 10 per cent holding in Clearpay
- ThinkSmart to return A$5.6m to shareholders in December
The key take for me from Aim-traded finance company ThinkSmart’s (TSL: 105p) annual meeting today is chairman’s Ned Montarello’s commentary on the takeover of Australian Stock Exchange-listed technology group Afterpay (APT:ASX – A$117) by New York Stock Exchange-listed Square Inc (NYSE:SQ.), a US$106bn fintech group led by Twitter founder Jack Dorsey. At current market prices, the all-share offer values Afterpay at A$34bn (£19bn).
The takeover is expected to conclude on 18 January 2021 at which point Afterpay has the right (on change of control) to exercise its call option early to purchase ThinkSmart’s 10 per stake in Clearpay, a fast-growing UK payment platform that enables consumers to split the cost of retail purchases into interest-free payments. The 10 per cent stake is also subject to a call/put arrangement between the two parties exercisable in 2023-24. The valuation methodology is based on key financial metrics as well as the market capitalisation of Afterpay.