Paysafe Blazing Ahead with AcquisitionsTia Winter | 25 July 2017
A new announcement from payment service provider Paysafe Group has revealed that the firm has been offered a preliminary purchase price from a group consisting of CVC Capital Partners and Blackstone. This announcement comes at the same time that the firm has agreed to an acquisition of Delta Card Services.
Paysafe is a particularly popular payment option among mobile casino players. In its statement, the firm noted that its possible purchasers have proposed plans for an all-cash acquisition offer for the firm’s entire issued capital, as well as capital that is still to be issued.
The proposal was made by a newly incorporated company, which is jointly owned by funds advised by members of the group and their affiliates. After announcing the news, Paysafe’s shares grew 8% on 21 July.
Paysafe Majority Shareholder Approves Possible Takeover
The card payment service provider has said that it was first approached with a purchase offer in May this year, having already turned down several acquisition proposals. The company then began to consider a possible offer of $7.66 per share (590 pence).
Every shareholder at Paysafe would be paid out 590 pence for every share they own, with the group noting that these financial requirements would be funded in part by disposing of any ‘non-core’ business verticals once the acquisition had been processed.
Paysafe’s largest shareholder, Old Mutual Global Investors, has offered a non-binding letter voicing its support of the company accepting the deal, despite Paysafe highlighting that there is no guarantee that an offer will actually be made.
Paysafe Acquires Delta Card Services & Executives for $470 Million
In the meantime, Paysafe has confirmed that its deal to acquire Delta Card Service (DCS) has been accepted for a total sum of $470 million. DCS is the holding firm of US-based payment processor Merchants’ Choice Payment Solutions (MCPS), which reported impressive revenues of $446 million for the year ended December 31, 2016.
The consideration for the purchase is now payable in cash, and Paysafe plans to fund this with a $380 million incremental loan. The company is planning to close the deal before the end of Q3 this year.
CEO of MCPS Todd Linden is also set to remain with his company as a part of PaySafe’s American Processing operations under the deal. Giovanni Diano, the former firm’s Chief Financial Officer, will also remain with the soon-to-be conglomerate.