Mobile payments specialist Boku buys Danal in reverse triangular merger

Friday 7 December 2018 | 09:45 CET | News
Direct carrier billing service provider Boku has agreed to fully acquire Danal, a US-based provider of mobile identity and authentication services. The acquisition is being structured as a reverse triangular merger to ensure that Boku acquires all of Danal shares from its multiple shareholders. Danal will merge into an US unit of Boku and cease to exist. 

Under the payment terms, the deal will include 26.7 million Boku shares to be issued at USD 0.0001 each, USD 3 million worth of to be issued Boku warrants exercisable at USD 0.141 each and USD 1 million of cash, payable on completion. Boku will also pay a deferred consideration of up to USD 64 million in shares and warrants, depending on Danal's future performance. Reports put the worth of the deal at up to USD 68 million. 

The transaction still has to be approved by Danal shareholders and is expected to close by the end of the year. Boku said the deal will accelerate the development of its mobile identity service and let it expand into new merchant segments, such as finance and government. It will also provide broader exposure to key geographies, including the US. 

For Boku, the acquisition is expected to be earnings dilutive next year, because the company intends to invest in the Danal platform. Earnings will improve through 2020 and be earnings accretion after that.

Danal customers include Western Union, BNP Paribas, PayPal, Square, Moneygram, Login.gov and USAA. Distribution Partners include Experian, Neustar, Fiserv and TransUnion. The company reported 2017 revenues of USD 5.1 and an EBITDA loss of USD 5.2 million, with net liabilities at end December 2017 at USD 10.3 million. 

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Categories: Internet / Mobile & Wireless
Companies: Boku / Danal
Countries: World
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