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China’s Ant Financial buys stake in Sweden’s Klarna


Klarna CEO Sebastian Siemiatkowski attends the launch of the online payment start-up’s pop-up store in London.

Dave Benett | Getty Images for Klarna

Ant Financial, the payment affiliate of Chinese e-commerce giant Alibaba, has invested in Swedish financial technology start-up Klarna as part of a global partnership between the two firms.

Klarna said Wednesday that Ant Financial had bought a minority stake in the firm for an undisclosed amount. The company is known for its “buy now, pay later” scheme that offers shoppers interest-free financing over monthly instalments.

“For too long consumers have had to endure non-intuitive, boring and overly complex services when shopping both online and offline,” Klarna CEO Sebastian Siemiatkowski said in a statement.

Ant Financial’s mobile wallet subsidiary, Alipay, had already been working with Klarna, embedding its payment platform in Alibaba-owned AliExpress to offer financing to the e-commerce website’s users. Klarna has been a fully regulated bank since 2017, when it obtained a license from Swedish regulators.

According to Klarna, the partnership with Ant Financial will “deepen ongoing collaborations” with Alipay.  The company said U.K. investment bank Numis acted as financial advisor to Klarna for the deal.

“At the heart of this cooperation between Klarna and Alipay is a shared ambition of innovating truly superior shopping experiences and creating destinations of inspiration for consumers across the world.”

A spokesperson for Klarna told CNBC that the stake was under 1% of ownership in Klarna. It comprises of a mix of primary and secondary shares, the latter of which have been purchased by existing investors.

Klarna posted its first annual loss last week, reporting a 1.1 billion Swedish krona ($116 million) loss on revenues of 7.2 billion krona. The company had enjoyed the unusual status of being a profitable fintech unicorn — a privately held firm with a valuation of $1 billion or more —in recent years, thanks to lucrative deals with big-name merchants.

It is tied with app-based challenger bank Revolut as Europe’s most valuable fintech start-up, having hit a $5.5 billion valuation last year following a $460 million funding round. The Stockholm-based group, which competes with American fintech company Affirm, counts the likes of U.S. rapper Snoop Dogg and Swedish retailer H&M as investors.

Ant Financial’s payments technology plays a significant role in China, where its digital wallet Alipay is — alongside WeChat Pay — among the most popular methods of payment in the country. The company is thought to be the world’s most valuable private fintech company, with a reported valuation of $150 billion.



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