Worldpay shares soar on bid approaches from Vantiv, JPMorgan
WorldPay Group, the UK’s largest payment processor, received on Tuesday competing approaches to auctioning credit card technology firm American Vantiv and JPMorgan Chase, to its shares more than 25 percent.
Tendering approaches show how automated payments specialists have become attractive targets for credit card companies, banks and technology companies looking to capitalize on payment popularity by smart phone or other mobile devices.
The Danish net payment service company A / S said last weekend that it had been approached by potential buyers.
WorldPay, which sells technology companies in order to receive payments through cards, online or on mobile devices, said the approaches were preliminary and that there was no certainty about an agreement. Sources close to the company said the offers were not solicited.
WorldPay’s shares hit a record high, up 25.4%. The company has a market capitalization of about 6.43 billion pounds ($ 8.3 billion), according to Thomson Reuters data.
Analysts have suggested that other companies may now be interested in bidding.
“We believe WorldPay is a unique asset and the current value of the two US pairs could also trigger the intention of the parties like Google, Amazon, Apple,” said a note from Mediobanca Valores.
Vantiv and JP Morgan now have until August 1 to announce firm intentions to purchase or withdraw. Vantiv could not be reached for comment. JP Morgan declined to comment.
Emphasis on the ladder
Payments from the processing industry grew rapidly as consumers avoided money. The number of non-cash transactions increased by 8.9% in 2014 to reach 387.2 billion euros, according to the Capgemini World Report on Payments.
While banks have tried to expand and buy more sophisticated technology, payment service companies such as PayPal and WorldPay gained much of the market share during the e-commerce boom.
Founded in 1989, WorldPay was retired from the British bank Royal Bank of Scotland to private companies Bain Capital and Advent International in 2010.
Listed company repayment companies on the London Stock Exchange in late 2015 when it was valued at 4.8 billion pounds.
The transaction activity in the payment industry so far has been dominated by smaller companies merged into larger groups divisions. Earlier this year, analyst at Pacific Crest Securities, said the approach could shift rather than scale, taking into account WorldPay and Vantiv as a convincing deal.
Vantiv, which has a market capitalization of 12.32 billion, recently participated in a test purchase of smaller players. We bought Moneris Solutions USA Of 425 million and Paymetric, which automates the processing of corporate payments.
While Vantiv focuses on the US, WorldPay supports 400,000 traders in 126 currencies in 146 countries. It also has a highly developed e-commerce platform serving multinational long-range internet-driven.
WorldPay’s company value over next 12 month profits is 13.88 times, according to Thomson Reuters data, above a ratio of 9.89 times to its competitors.