Fintech-as-a-service pioneer Rapyd is making waves in the financial technology landscape with its latest strategic move: the acquisition of Prosus' payments arm for emerging markets, PayU's Global Payment Organization (GPO), for a noteworthy $610 million. This landmark deal not only emphasizes Rapyd's commitment to expanding its global payments operations, but also underscores its ambitious goals before venturing into the public market.
Rapyd, valued at an impressive $8.75 billion, has garnered significant attention for its APIs that power payments, card issuing, digital wallets, and other financial services for industry giants like Uber and Ikea. With its acquisition of PayU's GPO, Rapyd is set to further solidify its presence in the fintech sphere. The move enables Rapyd to operate in an additional 41 licensed or regulated countries, greatly enhancing its global reach. Furthermore, this acquisition grants Rapyd the advantage of increased card-acquiring capabilities in Latin America and parts of Europe, complementing its extensive array of over 1,200 local payment methods.
The CEO and co-founder of Rapyd, Arik Shtilman, has highlighted the company's plans for future growth, with a new financing round of $700 million currently in the final stages. This not only showcases the company's commitment to its expansion endeavors but also indicates the means by which the PayU acquisition will be financed. Notably, this acquisition will not grant Prosus any stake in Rapyd.
The deal aligns well with Rapyd's broader objectives of scaling up its operations on a global scale before making its foray into the public market. Rapyd boasts an impressive list of major enterprise clients, including Meta, Netflix, Adidas, and Inditex. The acquisition of PayU's GPO is poised to play a pivotal role in supporting these ambitions.
The acquisition is still subject to regulatory approval, but if given the green light, it is expected to be the largest deal of 2023, accounting for a substantial 3% of fintech financing. This move positions Rapyd as a significant player in the industry, poised to reshape the landscape of global payments.
A key element of Rapyd's strategy is its cautious approach to going public. While plans for an IPO are on the horizon, the company is pragmatic about timing, considering factors such as market conditions and investor demand. Rapyd's CEO, Shtilman, highlights that the ability to fund future global expansion initiatives is a pivotal factor in this decision-making process.
In a landscape where private and public fintech firms are facing challenges due to a technology financing slump, Rapyd's ambitions remain undeterred. The acquisition of PayU's GPO bolsters its position to weather any such challenges while actively considering further acquisitions. This proactive stance sets Rapyd apart in the industry and solidifies its reputation as an industry disruptor.
Ultimately, as PayU CEO Laurent le Moal aptly puts it, Rapyd's track record positions it perfectly to take the acquired business to new heights. With this significant move, Rapyd is all set to redefine the fintech space, paving the way for a future where global payments are more seamless, efficient, and accessible than ever before.