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Ant Financial Increases Bid for MoneyGram

17 Apr 2017 4:10 am
By Phred Dvorak 

Ant Financial Services Group has raised its bid for U.S. money-transfer company MoneyGram International Inc. to around $1.2 billion -- topping a rival offer and making China's biggest online-payments firm once more the leading contender in an increasingly politicized takeover battle.

Ant Financial, which is controlled by Chinese e-commerce giant Alibaba Group Holding Ltd., has been looking to expand overseas and initially signed a deal to buy MoneyGram in January for $880 million.

But it was sideswiped in March by an unsolicited competing offer of around $955 million from payments processor Euronet Worldwide Inc .

Euronet, based in Leawood, Kan., also launched an intense lobbying campaign, telling U.S. lawmakers and the U.S. Treasury -- which leads the multiagency body that reviews foreign investments for national-security issues -- that an Ant takeover could pose privacy and information-control risks.

Ant has denied those claims and is fighting back with its own lobbying and public-relations campaign. On Sunday -- following MoneyGram's receipt of a binding offer from Euronet -- Ant increased its cash bid to $18 a share from $13.25. Ant will also assume or refinance MoneyGram's debt. MoneyGram's board unanimously voted to approve the increased offer.

"It's a superior financial bid -- at $18 it's extremely compelling," said MoneyGram Chief Executive Alex Holmes, describing Euronet's lobbying efforts as "noise." He said that the board had notified Euronet of its decision but declined to comment on any response.

Euronet didn't respond to a request for comment.

Douglas Feagin, Ant Financial's head of international business, said that progress has been made on the review by the multiagency body, the Committee on Foreign Investment, or CFIUS, but he declined to give specifics.

Ant's bid for MoneyGram is being closely watched as a barometer of how such acquisitions might be viewed under the new administration of President Donald Trump. Mr. Trump had campaigned on a protectionist platform and been highly critical of China's stance on trade and investment right after he was elected, though his rhetoric warmed following face-to-face meetings with Chinese President Xi Jinping in early April.

Concern has been rising on Capitol Hill over a surge in Chinese investment in U.S. companies, and CFIUS has opposed several recent Chinese acquisitions of U.S. and European companies.

On Ant's part, a purchase of MoneyGram would let the company marry the U.S. company's extensive global network for payments transactions with the 600 million customers -- mostly in China -- who use Ant's services now, said Mr. Feagin.

The Chinese company is already the dominant online payments provider at home, and is following a ballooning number of Chinese tourists abroad to offer purchasing services overseas as well. It has teamed up with partners such as France's Ingenico Group SA, whose in-store payment system is widespread among European merchants, and the online-payments arm of Thai conglomerate Charoen Pokphand Group.

Write to Phred Dvorak at phred.dvorak@wsj.com

(END) Dow Jones Newswires

April 17, 2017 00:10 ET (04:10 GMT)

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