Ant Financial, the company that operates Alipay, is buying MoneyGram for $880 million, its boldest move yet in a series of partnerships and investments that signal an international ambition.

Ant is owned by the billionaire Jack Ma and is affiliated with Alibaba, the giant Chinese e-commerce company. MoneyGram will give it access to a peer-to-peer transfer market in the U.S., as well as an engine for international remittances.

"The acquisition of MoneyGram is a significant milestone in our mission to bring inclusive financial services to users around the world," Ant Financial CEO Eric Jing said in a press release Thursday. The deal is expected to close in the second half of 2017.

Eric Jing, CEO of Ant Financial
Eric Jing, CEO of Ant Financial, which operates the Alibaba payments affiliate Alipay Bloomberg News

Buoyed by China's fast-growing middle class, Ant, Alibaba and Alipay have all been spreading their wings internationally. Ant recently received a digital wallet license in Hong Kong, considered a precursor to broader international expansion. It also is working on a distributed ledger project that it hopes will expand its 450 million user base by nearly 500% over the next 10 years.

Ant has been raising funds over the past year to support an international expansion. Alipay recently laid the groundwork for a larger geographic reach by adding support for Verifone and First Data payment terminals.

For the most part, these geographic plays have been aimed at travelers from China to the U.S. and other countries—Ant also has a deal with Ingenico to support payment terminals in Europe.

Having MoneyGram under its umbrella would give Ant and its affiliates a foothold to serve non-Chinese consumers. Beyond being the main U.S. rival to Western Union, MoneyGram also has a transfer partnership with Walmart. Western Union was at one time rumored to be interested in buying MoneyGram.

John Adams

John Adams

John Adams is Executive Editor of PaymentsSource.