In morning trade the Zip Co Ltd (ASX: Z1P) share price has avoided the tech selloff and pushed higher following the release of a positive announcement.
At the time of writing the payment solutions company's shares are up 2% to 95 cents.
What did Zip Co announce?
This morning the Afterpay Touch Group Ltd (ASX: APT) rival announced that it has added a major retailer to its buy now, pay later platform.
According to the release, Zip Co has agreed a partnership with Wesfarmers Ltd (ASX: WES) subsidiary Bunnings Group Limited to offer its interest-free payments to its customers.
Bunnings is Australia's leading retailer of home improvement and outdoor living products and a major supplier to project builders, commercial tradespeople, and the housing industry.
It is the latest in a wide range of retailers that have recently been added to the platform. These include Amart Furniture, ARB Corporation Limited (ASX: ARB), Harris Scarfe, Sony, and Target.
Zip CEO and managing director, Larry Diamond, appeared to be delighted with the deal.
He said: "We are both thrilled and proud to partner with a truly historic Australian brand in Bunnings. We believe Zip will be a great fit for Bunnings, not only for life's everyday necessities, but also for those larger aspirational home improvements, providing their customers with a better way to pay, over time, interest-free."
He expects the Zip platform to be live throughout the Bunnings Australian store network by early December.
Should you invest?
I think this is a great partnership for Zip Co and could be a big boost to its revenue growth over the remainder of FY 2019.
Not that it necessarily needs a boost. In the first quarter of FY 2019 Zip Co reported quarterly revenue of $15 million, up 117% on the prior corresponding period.
If it can continue this form through into FY 2020 then I think Zip Co could prove to be a good investment. But at this stage, like Afterpay Touch, it is a reasonably high risk option for investors.
