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Growth in online transactions has triggered a scramble for scale in a previously sleepy sector. There are plenty of smaller payment providers treading water as unloved divisions of struggling European banks, creating an opportunity for private equity buyers to execute mini roll-ups that could profitably be sold on to leviathans later.
The bigger issue for Nexi is whether it can integrate two different acquisitions quickly in the next year or two. Stagnant revenues and operating margins in Nets’ Nordic regions, where digital payments are popular, sets the scene for the work ahead. High debt at Nexi and Worldline will make further outsized deals hard for them to do in the short-term. Net debt to ebitda at Nexi would approach three times once the SIA and Nets deals complete next year. Worldline’s balance sheet will have similar leverage once Ingenico is completed.
https://www.ft.com/content/d54886fc-a60d-4dd7-b52f-a05bda70807e
