(Bloomberg) -- MoneyGram International Inc. soared in extended trading on Monday after blockchain-technology company Ripple purchased a stake and entered a partnership for international money transfers.
Ripple invested $30 million in shares and warrants at $4.10 a share and has an option to buy $20 million in additional shares or warrants at the same minimum price, according to a statement. MoneyGram will use Ripple's xRapid product as part of its cross-border payment process in a partnership that has an initial term of two years. The stock surged as much as 148% to $3.60. Larger rival Western Union Co. gained 2.2% post-market.
“As the payments industry evolves, we are focused on continuing to improve our platform and utilizing the best technology as part of our overall settlement process,” MoneyGram Chief Executive Officer Alex Holmes said in the statement.
MoneyGram began working with Ripple early last year on a pilot project. The Dallas-based company had seen its shares fall nearly 70% since a third-quarter revenue miss in November.
To contact the reporter on this story: Jeran Wittenstein in San Francisco at jwittenstei1@bloomberg.net
To contact the editors responsible for this story: Catherine Larkin at clarkin4@bloomberg.net, Jeremy R. Cooke
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