Financial analysts were full of praise for Afterpay’s ability to attract new investor Tencent, especially as it should now be able to exploit the Chinese and wider Asian markets.
Tencent, listed on the Hong Kong Stock Exchange and owner of WeChat, coughed up almost A$400m for a five per cent stake.
Pundits are clear that without a pal such as Tencent, Aussie Afterpay would have struggled to gain entrance onto one of the biggest markets for its buy-now-pay-later wares.
The investment charmed dealers and Afterpay’s price shot up over 35%, touching a high of A$39.59. This is a meteoric turn-around from being seen as a major victim of a Covid-19 induced global meltdown and a share price that had hit a floor of A$8.
Anthony Eisen and Nick Molnar, co-founders of Afterpay, trilled in unison: “We feel very privileged to welcome Tencent as a substantial shareholder in our business. Being able to attract a strategic investor of this calibre is extremely rewarding and is a testament to our team and the strength of our differentiated business model.
“Tencent’s investment provides us with the opportunity to learn from one of the world’s most successful digital platform businesses. To be able to tap into Tencent’s vast experience and network is valuable, as is the potential to collaborate in areas such as technology, geographic expansion and future payment options on the Afterpay platform.
“We remain focused on delivering value for our new and existing shareholders over the long term.”
James Mitchell, Chief Strategy Officer of Tencent, didn’t hold back either: “We are pleased to become investors in Afterpay. Inside China we operate the leading digital payment service and a rapidly growing FinTech platform, and outside China we have actively invested in pioneering FinTech companies, providing us with unique insights into emerging FinTech services.
“Afterpay’s approach stands out to us not just for its attractive business model characteristics, but also because its service aligns so well with consumer trends we see developing globally in terms of Afterpay’s customer centric, interest free approach as well as its integrated retail presence and ability to add significant value for its merchant base. We look forward to a deep and long-term business partnership between Tencent and Afterpay.”
Everyone will be now waiting to see if all the back-slapping and congratulations will turn into something substantial for Afterpay, a company which covetly eyes Asia.
