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Yet more deals announced in payments sector

21 July 2017  |  14487 views  |  0 Buy Road sign

Investors' interest in the payments sector continues to intensify with today's news that three of the largest private equity firms in the world have made bids to acquire stakes in payment providers.

Two PE firms Blackstone and CVC Capital Partners have bid £2.9bn to acquire US-based payment processor Paysafe. Meanwhile, London-based Permira has bought a 10% stake in Swedish payments startup Klarna at a cost of £250m.

These deals come the day after French payment provider Ingenico acquired another Swedish payments firm Bambora for £1.5bn.

Many more deals have been announced in the last month, including a £7.7bn bid for UK-based Worldpay from US credit card processor Vantiv as well as reported bids for Danish payment provider Nets.

Paysafe had initially been approached by a consortium back in May. Since then it has seen its share price rise from 450p per share to 582p and the Blackstone/CVC bid values each share at 590p, a premium of 30% based on its May share price and a reflection of just how highly rated the sector currently is by investors.

The bid has the support of Paysafe's largest current shareholder Old Mutual Global Investors and Blackstone and CVC have until August 18th to make a formal bid.

The deal for Klarna comes after the Swedish startup was awarded a banking license by the Swedish financial authorities in June. 

The appetite for all things payments-related has been attributed to the growing trend for consumers to eschew cash as a means of payment in favour of their smartphones and other mobile devices. 

The current spate of deals was arguably started back last year when MasterCard acquired UK-based Vocalink for £700m.

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