Bill-to-mobile is often sidelined in discussions about mobile payments, but Boku Inc. brought the technique to center stage this week with a deal to acquire San Jose, Calif.-based Danal Inc. Boku’s shares, which trade on the London Stock Exchange’s Alternative Investment Market, fell in the wake of the announcement, with a 4% drop on Friday to 72.35 pence (92 cents).
Even so, the transaction will bring to Boku Danal’s real-time identification and authentication technology along with its blue-chip client list, which includes Western Union, MoneyGram, BNP Paribas, USAA, PayPal, and Square.
The complicated deal, known as a reverse triangular merger, is valued at a potential $68 million, mostly payable in Boku stock and warrants and including $64 million in deferred value. The parties expect the deal to close by year end.
Based in San Francisco but with offices around the world, Boku has been one of the most active players in the bill-to-mobile market, which offers consumers the ability to buy items online or from app stores by having them charged to their mobile-carrier bill. In 2015, it launched a service that lets mobile users charge a purchase to their mobile number with a single click or tap. And it has a history of acquiring rivals, including mobileview Italia in 2015 and mopay Inc. the year before.
Danal was a rival provider until 2016, when it sold its BilltoMobile unit to U.K.-based competitor Bango in a $3.5 million deal.