MercadoLibre's fintech arm raises $181 mln with debt issuance in Brazil
SAO PAULO, Sept 23 (Reuters) -The fintech arm of Latin American e-commerce giantMercadoLibre MELI.O raised 1 billion reais ($181.2 million)through a debt issuance in Brazil, it said in a statement on Monday.
Mercado Pago said it will use the resources to expand its credit and payments operations, as well as to enhance working capital and improve the management of its liabilities.
WHY IT'S IMPORTANT
Mercado Pago, which works as digital bank and a payments firm, has seen rapid growth within MercadoLibre, representing some 40% of the firm's total revenue in the second quarter.
Mercado Pago is also a key source of funding for MercadoLibre, primarilythrough customer deposits, thoughit has been pushing to diversify its funding sources.
BY THE NUMBERS
The debt issuance will be made in two equal parts of 500 million reais: one due in two years and yielding the local benchmark CDI rate plus 0.5% per year and the other due in three years, paying the CDI plus 0.6%.
ADDITIONAL CONTEXT
Last week, MercadoLibre announced the signing of a $250 million financing deal with JPMorgan JPM.N aimed at expanding Mercado Pago's credit profile in Mexico.
($1 = 5.5195 reais)
Reporting by Andre Romani; Editing by Cynthia Osterman
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