In an acquisition deal, Western Union Co. purchased 15% stake in Saudi STC Pay for $200 million, at a valuation of around SAR 5 billion ($1.3 billion).
The remittance giant has enabled STC to expand its money transfer services beyond the Gulf, making it the first Saudi unicorn. STC Pay is a subsidiary of Saudi Telecom and provides a range of digital payments alongside retail payments and international remittances through their mobile application.
Saudi Telecom will invest 400 million riyals as additional capital for STC Pay and another 802 million riyals, provided it obtains a digital banking license. STC will be investing the capital for its long-term financial service plans.
In a statement, CEO of STC, Nasser Al Nasser, remarked to be playing a vital role for the vision of Saudi Arabian Monetary Authority in creative initiatives as a digital enabler and pioneer in digital transformation.
STC added to have STC Pay unit is the first licensed FinTech company, by the Saudi central bank with over 4.5 million users.
As part of expansion plans, STC Pay is in talks with Gulf regulators, subject to regulatory approvals, to operate in the UAE, Bahrain, and Kuwait.