In the move to expand operations in Asia, particularly in Japan and Korea, German Fintech company Wirecard is partnering with Japan Telecommunicating company Softbank.
Softbank is investing in the company, acquiring almost 5.6% stake of Wirecard. The deal was announced by Wirecard last Wednesday, April 24, 2019.
Despite the recent scandal that cost Wirecard $10 billion in market value, the partnership discussions were pushed through. The executives and shareholders will have to decide whether to approve the investment in a meeting happening this June 18.
Proposed Terms
Softbank proposed that five-year bonds will be converted into a total of 5.6 percent, approximately €130 per share. This is a good price, knowing that the scandal has affected the market value of the company.
After the announcement, Wirecard’s share went up to 9 percent or €134 per share.
In expanding in Asian markets, the fintech company hopes to dive into artificial intelligence and data analytics. Japan is known to have advanced technology yet lacking in the fintech industry. Japanese are still dependent on a cash payment basis, which has to be improved to cater to the growing economy of the country.
According to an article published by TechCrunch, Softbank also needs Wirecard’s help in providing financial services with high tier portfolio companies like Grab, WeWork, DoorDash, Alibaba and more.
“Under the Memorandum of Understanding, Softbank Group will seek to support Wirecard’s geographic expansion into Japan and South Korea, as well as providing collaboration opportunities within the Softbank Group’s global portfolio in digital payments, data analytics, AI and other innovative digital financial services,” according to a statement by Wirecard.
The potential partnership between the two companies will help strengthen Asia’s position in the Fintech industry.
Meanwhile, Softbank continues to be an influential investor, creating a $100 B known as Vision Fund.
