On Tuesday, Worldpay, the payments processor priced its IPO at £2.40/share ($3.69), giving it a market value of £4.8b and making it the biggest U.K. IPO in 2015. On the first day of trading shares rose 2.5% above the IPO price. Worldpay was priced at 16x enterprise value to EBTIDA. This is quite rich in comparison to its US comps Vantiv and First Data which trade at 12.5x and less than 12x respectively.
The company, once part of Royal Bank of Scotland, builds and runs the systems that allow retailers to take a customer’s card details and ensure their transaction is captured, authorized, processed and settled. Dull, right? Yet its initial public offering in London valued Worldpay at about 33-times net profits for 2016, as forecast in pre-IPO research. In its first day of official trading on Friday it was 9% above its listing price in morning trading. OK, so the bluster around financial technology companies and especially the advent of mobile payments makes this area more sexy.