London-listed Optimal Payments has agreed to buy Skrill Group for an enterprise value of around EUR1.1 billion in a deal it says will create a major global player in online payments and digital wallet services.
The reverse takeover will see Optimal acquire the entire listed share capital of Skrill - majority owned by CVC Funds following a EUR600 million 2013 deal - for EUR720 million cash and 37.5 million new ordinary shares.
AIM-traded Optimal has carved out a niche in the online gambling world, helping users place stakes and move winnings between various sites.
Founded in 2001, Skrill employs 700 people and is one of Europe's largest online payment systems and among the world's biggest independent digital wallet providers, with over 36 million account holders. In 2013 it acquired paysafecard, a prepaid online voucher provider and late last year agreed to buy a similar outfit, Ukash, although that deal has yet to be completed.
Optimal says that the acquisition will create a market leader in the stored value and payment processing sectors. Importantly, it will also help it to capitalise on the expected growth in the North American online gambling market.
Joel Leonoff, president and CEO, Optimal Payments, says: "The acquisition of Skrill will create a global tech champion in the fast growing digital payments space and we believe represents a transformational leap forward that greatly accelerates our strategic plan."
Trading in Optimal was suspended on the news after closing at 418.75 pence on Friday, valuing the firm at £674. The agreement, expected to close by the third quarter, will be paid for through a rights issue for around £451 million, cash and new debt facilities.