(Bloomberg) — Italy’s Nexi SpA agreed to buy SIA SpA to create one of Europe’s biggest payment providers, adding to the wave of consolidation sweeping the continent’s financial services industry.
The all-share deal values closely-held SIA at 4.56 billion euros ($5.3 billion) and gives Nexi a 70% stake in the combination. It catapults the joint company into the nation’s top 10 publicly traded businesses, with annual revenue of about 1.8 billion euros and a market value of more than 15 billion euros.
“The combination with SIA should create significant value for shareholders,” analysts at Kepler Cheuvreux wrote in a note to investors on Monday. The deal “looks fairly strategic and the deal should finally bring more synergies than initially expected.”
Payment providers are ramping up acquisitions to bulk up across Europe, with France’s Worldline SA agreeing in February to acquire Ingenico Group SA in a 7.8 billion-euro deal. The industry is one of the most active for M&A globally as firms seek become more competitive and keep pace with rapidly changing technology.
Nexi and SIA wrapped up more than a year of negotiations after disagreements over government and valuations brought the talks to the brink of collapse several times. The merger creates a company with about 2 million merchants and 120 million cards, potentially making it a stronger competitor to Worldline and Adyen NV of the Netherlands.
Nexi is seeking to expand even further to become the biggest European payments provider, people with knowledge of the matter said. The Italian company has made a non-binding offer for Denmark-based Nets A/S, they said.
Photographer: Alessia Pierdomenico/Bloomberg
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