Money transfer giant MoneyGram can give further consideration to Euronet’s surprise bid to acquire the company from under the nose of Ant Financial, which in January entered a definitive agreement to buy MoneyGram.
The unsolicited proposal from Euronet, received on March 14, has been determined by MoneyGram’s board to potentially comprise a “company superior proposal,” as defined in MoneyGram’s agreement with Ant Financial. That means MoneyGram can take certain actions to further consider the Euronet proposal—including engaging in direct discussions with Euronet about a potential sale—without violating terms of the original agreement with Ant. MoneyGram came to that conclusion “after consultation with its outside legal and financial advisors,” the company said.
Euronet’s offer calls for the payments processor to acquire all outstanding MoneyGram shares for $15.20 in cash, resulting in a $1 billion deal. Ant Financial—the online and mobile financial services affiliate of Chinese e-commerce powerhouse Alibaba Group—offered about $880 million to acquire MoneyGram in a deal that was expected to close in the second half of 2017 after being approved by MoneyGram’s board of directors in late January.
Despite the higher dollar amount of the Euronet proposal, MoneyGram’s board of directors has not changed its recommendation in support of the Ant Financial deal, and is not making any recommendation with respect to the Euronet proposal. “There can be no assurance that the board of directors will ultimately determine that the Euronet proposal is a company superior proposal, that the terms of any transaction will be the same as those reflected in the Euronet proposal or that any transaction with Euronet will be agreed to or consummated,” MoneyGram said.
Along with more money, Euronet is offering MoneyGram what it claims is a faster path to closing. Because Euronet is based in Kansas, its acquisition of MoneyGram wouldn’t need to be approved by the Committee on Foreign Investment in the United States. It also would be easier for Euronet to take over MoneyGram’s money transmitter licenses in the U.S. than for China-based Ant Financial to do so, Euronet claims.
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