Blackstone, CVC Make Paysafe Move as Sector M&A Rages

Gladys Abbott
July 21, 2017

The funds initially approached the board of Paysafe in May and had made a number of indicative proposals since then, Paysafe said.

Paysafe Group PLC (LON:PAYS) shares jumped higher after the online payments firm said it has received a conditional, all-cash, takeover offer from Blackstone and CVC Capital Partners at 590p per share, valuing the business at £2.9bn.

Shares in Paysafe were up 7.4 percent to 582 pence a share at 0820 GMT on Friday, leading gainers in Britain's mid-cap index. 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 now is by investors.

Paysafe's revenue had grown 600 per cent since 2011, a large proportion of which came from handling gambling transactions, for betting companies such as Ladbrokes and William Hill.

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In a separate statement Paysafe announced they have acquired Merchants' Choice Payment Solutions for $470 million.

The price is at a 8.9% premium to Thursday's closing price and at a 34% premium to the average price for the six months ended June 30.

Payments companies have become targets for credit card companies and banks seeking to capitalise on a switch from cash transactions to paying by smartphone or other mobile device.

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.

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