On Friday, the Financial Times reported that WorldFirst “abruptly closed” its U.S. business to avoid having the acquisition “derailed by American regulators.” The paper cited two people briefed on the decision. WorldFirst’s U.S. operation was based in Austin, Texas, and the company also had employees in San Francisco. One person told the FT that the move would result in “heavy job losses” among the U.S. staff.
WorldFirst didn’t respond to requests for comment.
It’s the latest example of the collateral damage that’s resulting from the escalating U.S.-China spat, which centers on a trade imbalance as well as alleged intellectual property theft by Chinese firms. The two governments have set a deadline of early March to come to an agreement on a trade deal. In the meantime, the Trump administration has been blocking big deals, such as Chinese companies taking significant stakes in U.S. businesses and from buying certain U.S. technology components, claiming such transactions would pose a national security threat.
WorldFirst is one of the main services used by Amazon sellers to handle transactions across the world so merchants can get paid in many different currencies on a single platform. An Amazon sellers group sent an email to members on Friday suggesting that WorldFirst customers switch to rival service Payoneer, which “can help if you are selling in the US, UK, Europe, Canada, Japan, China, Australia, and Mexico,” the message said.
WorldFirst said service for customers outside the U.S. and Canada will be unaffected by the change. Clients in those two countries were told that between Jan. 31 and Feb. 7, they could only make outbound transfers to existing beneficiaries. After Feb. 7, any balances would be returned to the sender, and after Feb. 20, the company would have no live phone or email service.
For Ant, the expected acquisition of WorldFirst supports the company’s global push and expansion beyond mobile and online payments service Alipay. Ant CEO Eric Jing told CNBC in November that his company was investing in technology services for banks so that it’s not limited to payments.
Ant is viewed as an IPO candidate, but Jing said the company doesn’t have a “timetable for that.” Alibaba agreed exactly a year ago to acquire 33 percent of Ant, and has said it won’t have any control over the company. Alipay was spun out of Alibaba in 2011.
WATCH: Ant Financial says it doesn’t have a “timetable” for an IPO