MoneyGram International (MGI) Stock Flies On Takeover Chatter

MoneyGram International MGI Stock News

MoneyGram International Inc (NASDAQ: MGI) is flying in the market this morning, trading on gains of nearly 50% early on. The gains come after the company became the center of takeover chatter. Here’s what’s going on:

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MGI Stock Heads Up On Hopes Of Western Union Led Takeover

Various reports are popping up, suggesting that Western Union is interested in acquiring MoneyGram. Should this transaction take place, it will bring together two of the largest providers of money-transfer services in the United States.

According to the reports, Western Union has made an offer to takeover MGI. However, no decision has been made as of yet and Western Union could decide to back away from the deal.

Nonetheless, now would be great timing for a transaction like this. After all, MoneyGram has been struggling as online payments start to take over the payment transfer industry. Aside from growing competition, regulators seem to be working to trim the fees associated with moving money around the world.

At the same time, the COVID-19 pandemic has created more pain for the comapny. As consumers have been told to shelter in place, MGI locations have been dying on the vine.

At the same time, MoneyGram is working to ramp up online transactions. However, these only account for about 18% of the company’s business. As such, MGI could use a boost, and a takeover would be about the best boost that can happen.

Will A Takeover Take Place?

This is a hard one to call, but things are looking good for MoneyGram. The reality is that Western Union is a big player in the money transfer game. Through an acquisition like this, it could become the largest player in the United States.

At the same time, if Western Union did acquire MGI, the company would bring a large book of data to the table, along with online money transfer technology that would be beneficial. As a result, there’s a good chance that this deal may happen, especially when you consider the struggles that the company has faced as of late.

All in all, investors should keep a close eye on MGI stock.

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