The Zip (ASX: Z1P) share price is going nuts thanks to Amazon, it’s up around 15%.
Zip Co provides customers with a revolving line of credit to finance their retail purchase with its brands of Zip Pay, Zip Money and Pocketbook. It is one of the largest buy now, pay later providers in Australia. Some of its largest clients include Bunnings Warehouse, Appliances Online, EB Games and Officeworks.
Zip’s Huge New Agreement
Zip announced that it has entered into a strategic agreement with Amazon Australia.
The agreement means Zip will be available as a payment option shopping on Amazon.com.au. Zip has won the race to be Amazon’s first Australian instalment payment option.
It’s expected that Zipp will go live on Amazon.com.au on 7 November 2019, which is today.
But Amazon Australian will be getting something out of this strategic agreement too, Zip will issue an affiliate of Amazon warrants/options to acquire up to 14.615 million shares.
The price of these warrants will be the average share price of the 20 trading days before 31 October 2019 which calculates to be $4.70.
A 25% portion of the warrants (around 3.65 million shares) will vest at the same time as Zip enters into the agreement. The rest will be subject to vesting milestones based on processed volumes.
The warrants may be exercised for seven years after the issue date, as long as vesting conditions are met. However, some of the warrants can expire in certain circumstances such as vesting milestones not being met by specified dates.
Zip CEO and Managing Director Larry Diamond said: “We are thrilled to have secured this strategic agreement with Amazon Australia, providing customers with a more flexible way to pay.
“This puts Zip firmly on the main stage by allowing customers shopping on Amazon.com.au to use Zip to pay at their pace. The agreement delivers a fantastic experience for customers who are looking to own the way they pay.”
[ls_content_block id=”19823″ para=”paragraphs”]
[ls_content_block id=”18380″ para=”paragraphs”]