Investing.com -- Shares of DLocal Ltd. (NASDAQ:DLO) edged up 4% following CEO Pedro Arnt's interview where he discussed the company's potential acquisition plans and clarified that DLocal is not exploring a sale. The interview, first reported by Bloomberg News, provided insight into the strategic direction of the Uruguay-based payment services provider, which is considering purchasing a smaller fintech rival to enhance its product offerings and market share, particularly outside Latin America.
Arnt highlighted the current favorable market conditions for acquisitions, given the challenging funding environment for fintechs. He suggested that there is a greater likelihood now than in the past for DLocal to make a strategic purchase. However, he did not confirm whether the company is currently in talks to buy any specific company.
The CEO also addressed past takeover proposals for DLocal, stating that while he had been approached last year, the company is not for sale. His remarks come amidst a backdrop of consolidation in the global payments industry, driven by a shift from cash to digital payments and an increase in transaction volumes.
Arnt remains optimistic about the emerging markets payments industry and believes that DLocal can return to valuations over $20 billion if it maintains its leadership position. The company plans to invest in new products, digital infrastructure, and software engineering talent to support growth in payment volumes over the next decade, aiming for margin expansion.
In addition to acquisition plans, Arnt also touched on DLocal's decision to continue holding Argentine sovereign bonds on its balance sheet, the attractiveness of Argentina for global e-commerce companies due to new cross-border purchase rules, and the potential acceleration of Chinese e-commerce clients in emerging markets. He stressed the importance of working with companies that minimize regulatory pushback from European and American regulators.
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