CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure. CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure.

Openpay share price surges on acquisition announcement

We examine the details behind Openpay’s just-announced acquisition: Payment Assist.

Following in the footsteps of Afterpay and Zip, Openpay on Tuesday announced it had entered into a deal to acquire 100% of Payment Assist – a UK-based, automotive-focused BNPL provider.

The market responded with unbridled optimism to the reveal: Openpay (ASX: OPY) opened the session at $1.47 and by the afternoon session was up as much as 20.21% to $1.70 per share. The stock closed out the session up 17%.

What is Payment Assist?

A buy now pay later company with a focus on automotive servicing and repair, Payment Assist is currently available at over 7,000 locations in the UK and has around 177,000 customers.

According to Openpay's ASX annoumcnet, Payment Assist booked £78.1 million in total transaction volumes in FY20, up 26% year-on-year, and the company is targeting transaction volumes of £105.3 million during this calendar year.

The company’s total addressable market is estimated at £26.7 billion – on an annual basis.


Openpay management highlighted a number of key drivers behind the deal, including:

  • Accelerating the company’s path to profitability
  • Gaining a strong foothold in the UK BNPL market as a whole
  • Rapidly increase the company’s overall transaction volumes, customer base, as well as opening new avenues for further growth.

What's your view on the BNPL sector? Whatever you think, you can use CFDs to trade both rising and falling markets, through IG’s world-class trading platform now.

For example, to buy (long) or sell (short) Openpay using CFDs, follow these easy steps:

  • Enter ‘OPY’ in the search bar and select it
  • Choose your position size
  • Click on ‘buy’ or ‘sell’ in the deal ticket
  • Confirm the trade

Alternatively, you can invest in shares directly through our share trading service.

Details of the deal

Looking at the specifics of the deal, the acquisition, once completed, would involve an upfront consideration of £11.5 million – made up of £8.2 million in cash and £3.3 million in Openpay stock.

Beyond that, there were some £17 million in earn-out considerations earmarked between FY21 to FY23, made up of two tranches and an out-performance earn-out consideration. 60% of these considerations would be paid in cash, while the remaining 40% would be paid in Openpay stock.

The company still requires approval from the UK's Financial Conduct Authority (FCA), but nonetheless expects the deal to be closed during the first half of fiscal 2022.

Looking at the tangible impact this acquisition would have had on Openpay's UK operations in CY20, the company, said that on a pro-forma basis, its UK total transaction volumes would have close to tripled, rising from £43.6 million to £121.7 million.

On the top-line, management noted that Openpay's UK revenue would have experienced a similar growth step-up in CY20, rising from £2.4 million to £ 8.4 million and boast what was described as very strong margins.

Commenting on the acquisition, Openpay's MD and CEO, Michael Eidel said:

'The proposed acquisition of this fast-growing business accelerates our automotive market entry and secures a significant foothold for Openpay in the UK. Material growth synergies exists between Openpay and Payment assist.’

By comparison, MD at Payment Assist, Neil Jeffery, said:

'By teaming up, Payment Assist and Openpay bring combined expertise and market knowledge which is unrivalled in the UK automotive industry. We are delighted to be joining with Openpay and look forward to the benefits we can bring to merchants and customers.'

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Friday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.