With its planned acquisition of Ingenico, Worldline intends to establish itself as a European leader in payment services. Its CEO, Gilles Grapinet, claims that this is the biggest consolidation operation in the sector ever carried out in Europe. Read all about it.
Sales of over 5 billion euros
On February 3, Worldline announced plans for a friendly takeover of Ingenico for 7.8 billion euros to create the world's number four player in the sector. Completion of the merger is scheduled for the 3rd quarter of the year. The new entity will represent sales of 5.3 billion euros and more than 20,000 employees in some fifty countries.
Worldline's business is divided into three main areas: payment services for merchants, financial processing and payment security services for banks, and payment technology solutions for various institutional players. As for Ingenico, historically present in payment systems and terminals, its activity has evolved towards payment and Internet services. Worldline's CEO indicated that the Group would carry out a strategic review of its compatriot and competitor's historical business.
Europe's largest payments consolidation operation
This proposed takeover should enable the two combined groups to create a world-class European champion in electronic payments. It represents the largest payments consolidation operation in Europe. The significant amount of the transaction, which has doubled since the end of 2018, is explained by the significant improvement in Ingenico's results on the one hand, and the reduction in the number of targets available on the market on the other.
Worldline's takeover of Ingenico comes at a time when traditional banks, in search of growth drivers, are engaged in a fierce race to pool their digital investments and compete with the startups that are springing up everywhere. This market, boosted by the sharp rise in online purchases, is also attracting the GAFAs, who have considerable resources at their disposal. Apple recently signed an agreement with Goldman Sachs on credit cards and its Apple Pay payment system. For its part, Google should soon be offering current accounts via its Google Pay app, thanks to its partnership with US bank Citygroup.
To face up to this increased competition in the payments market, Worldline plans to maintain its level of R&D investment. These will represent between 5% and 6% of the new entity's sales, or nearly 300 million euros a year. The group will invest in instant payments, Blockchain technologies, feature enhancement and cybersecurity. The aim is to generate 254 million euros a year in synergies by 2024.