Australia-based buy-now-pay-later (BNPL) firm Zip has brokered a deal to acquire US-based rival Sezzle in a $352.59m (A$491m) deal.

The deal, which accelerates the ongoing consolidation in the BNPL space, is expected to deliver substantial synergy benefits to drive profitability for both companies.

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Zip co-founder and global CEO Larry Diamond said: “We are delighted to be bringing Zip and Sezzle together under a transformational transaction that is expected to deliver immediate scale and enhanced growth, which will support our path to profitability. Combining with Sezzle positions us as a leading global BNPL provider and prioritises our ability to win in the important US market.”

Sezzle provides interest-free instalment plans for consumers at digital stores and in-store locations. The firm also offers Sezzle Up, an opt-in feature that helps consumers to build their credit score.

The addition of Sezzle, which is also listed on the ASX, is expected to expand Zip’s presence and product offering and bolster capabilities to accelerate its expansion in the US.

The combined entity is expected to have about 8.8 million customers and 60,000 merchants in the US.

Sezzle co-founder, executive chairman, and CEO Charlie Youakim said: “We are extremely excited about the opportunity to create a leader in the financial services industry by combining with Zip and its management team led by Larry and Pete. Paul and I believe it will be a great cultural fit for both our organisations and we’re excited to be part of Zip’s next chapter.”

In November last year, Zip wrapped up its previously announced takeover of Central European BNPL provider Twisto Payments.

In September, the firm made a strategic move into the Indian BNLP space with a $50m investment in fintech ZestMoney.

The same month, Zip signed a deal to buy BNPL firm Payflex to further expand its footprint on the South African continent.