Business

Brazilian fintech Stone closes deal to acquire Linx for BRL 6 billion

Stone founder André Street, and Alberto Menache and Nércio Fernandes, Linx founders, had previously considered a merger, but the subject had never advanced, says the Brazil Journal

Photo: Stone/Facebook.
  • Brazilian acquirer Stone closed a deal with retail management software company Linx to buy the latter for BRL 6.04 billion (about $ 1.11 billion);
  • The deal will be carried out 90% in cash and 10% in stocks;
  • Stone previously considered the acquisition of TOTVS, but favored Linx because of a more similar customer base.

The Brazilian payments company Stone announced a deal to acquire the retail management platform Linx, reports the Brazil Journal.

The deal brings together a retail management software firm that recently expanded its portfolio to payment solutions (hence the launch of Linx Pay in late 2018 and the acquisition of Pinpag earlier this year) with an acquirer that was moving forward in the retailer’s value chain delivering other solutions – including management software.

Stone is paying BRL 6.04 billion (about $ 1.11 billion) for Linx – 90% in cash and 10% in stocks – and will issue $ 1 billion in new shares to finance the purchase. The value includes a premium of 30% over the market value of Linx at the close of the market this Monday.

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Stone founder André Street, and Alberto Menache and Nércio Fernandes, Linx founders, had previously considered a merger, but the subject had never advanced, says the Brazil Journal. About a month ago, Stone’s CEO, Thiago Piau, came to Linx with a more advanced proposal.

According to a person familiar with the negotiations, Stone considered the acquisition of management software development firm TOTVS, but favored Linx because its customer base is more similar to that of Stone.