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Paysafe and Worldpay deals suggest change is afoot for way we buy things

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Who would have thought electronic payments systems were so valuable?

Not me for one, but a second multi-billion bid in under a month hints suggests the cat is out of the bag and some fundamental changes are underway in the world of cashless transactions.

Paysafe PLC (LON:PAYS) is today’s recipient. Private equity group CVC and fund management giant Blackstone are the bidders, offering 590p per share and valuing the business at £2.9bn.

Given just five years ago you could have picked it up when it was called Optimal Payments for around 69p, the bid marks a stellar rise, especially as only a few months ago the company found itself the target of US short-selling firm Spotlight.

READ: Worldpay takeover may be first of many as US firms go Brexit bargain hunting

It rebuffed those accusations, which centred around its Asia Gateway operation, comfortably enough, though this division has already been earmarked for sale by its potential new owners.  

Paysafe’s business is based around the Neteller payments-processing business and consumer-facing Skrill mobile-payments and betting firm.

Worldpay PLC (LON:WDP), which earlier this agreed to merge with US rival Vantiv in a high profile £7.7bn deal, is more of a business-to-business operation.

But the price paid was similarly way above what the market had estimated the former RBS business was worth.

Here too though there was private equity interest before the deal with Vantiv was thrashed out.

JP Morgan was a potential bidder though a possible conflict of interest apparently forced it to drop out.

Private equity firms are normally pretty canny when it comes to valuing a business and, if not right at the front, are there or thereabouts when it comes to a spotting a new trend.

It is worth noting that other suggested potential bidders for Worldpay were iPay owner Apple with rivals Google and Amazon also mentioned.

They proved to be just rumours, but If these deals do mark the start of an electronic payments land grab, how long can it be before one these mega-giants decides to get involved.

At that point the fun could rally start. 


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