(Web Desk): STC sells 15 % stakes of STC Pay to the world’s largest money transfer giant, Western Union, for a hefty amount of $200 million.
STC, one of the largest cellular operator in Saudi Arabia, said in a statement, The acquisition of STC Pay, which values the company at SR5 billion ($1.3 billion), will finance its capital and support long-term expansion plans
Mohammed bin Khalid Abdullah Al-Faisal, STC Group chairman, said that deal by WU is a clear reflection of the company’s stature as a “digital enabler”. He also said, “the investment created the first Saudi unicorn and the first fintech unicorn in the Middle East
Unicorn is a term used for private companies having the value of their assets at $1 billion or more.
Sources told Reuters last month that STC had hired banks to arrange a potential initial sale of shares in its product and services development arm, Solutions by STC.
Reducing dependence on cash is part of the Saudi government’s efforts to modernize the Kingdom’s economy.
WU will pay $133.3 million for acquiring 10% shares in STC Pay upon the completion of the deal. As soon as STC Pay acquires a license as a digital bank, WU will pay the amount of $66.67 million, that will increase its stake to 15%
STC Pay’s mobile wallet, launched in 2018, offers financial services to its customers in a digital way. It offers peer-to-peer money transfer service, transfers to bank accounts, payments at partner stores with QR codes, payment of utility bills, and international money transfers that are powered by Western Union.
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