Worldline has this morning announced it agreed a deal to buy local rival Ingenico in a €7.8 billion deal that will create a global player in the rapidly consolidating payments industry.
The two companies said the combination would create a regional champion and the world’s fourth largest payment services provider, which would provide services to nearly 1 million merchants and would have had combined revenues of €5.3 billion in 2019. Ingenico shareholders can expect to receive €123.10 per share, a 17% premium on Friday’s closing price, or a mix of cash and shares.
The deal gives Ingenico an equity value of €7.8 billion, and will leave Worldline shareholders owning 65% of the combined group, the companies said.
The payments sector is amidst a golden era of dealmaking activity, as companies seek scale to better exploit rapid changes in consumer behaviour.
“There is global competition in payments systems, and size is really important in this business,” comments Cédric O, French digital economy minister, in the Anglo-American Press Association on Monday. “You have to invest in innovation.” Bernard Bourigeaud, Ingenico’s chairman, said the deal offers the chance “to create the undisputed European champion in payments on par with the largest international players.”
The companies said they expect the deal to close in June or July this year, subject to regulatory clearance. Ingenico has previously been the subject of intense merger speculation, with French bank Natixis exploring a possible combination at the end of 2018. French technology company Atos, meanwhile, last month said it would offload part of its stake in Worldline, suggesting the move would offer the payments group more flexibility to pursue consolidation opportunities.
The financial technology sector is consolidating fast, with global payments set to reach $3 trillion a year in revenue by 2023 as more people switch from cash to digital payments for online and high street sales, according to research by consulting firm McKinsey.
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