Advent International and Bain Capital have agreed to acquire the WorldPay payment processing business of RBS. The enterprise value is up to £2.025bn including a £200m contingent consideration.RBS will retain a 19.9% stake in the newly-independent business.
Bain Capital and Advent International, the leading global private equity firms, have today signed an agreement with The Royal Bank of Scotland Group plc (RBSG) to acquire its subsidiary business, RBS WorldPay for an enterprise value of up to £2.025bn including a £200m contingent consideration. RBS will hold a minority stake of 19.9% in the new WorldPay business. The transaction is subject to regulatory approval and is expected to close before the end of 2010.
RBS WorldPay, also known as RBS Global Merchant Services, is the fourth largest provider of card payment services globally and the largest in the UK and Europe. In 2009, the business processed a total of 6.8bn transactions worldwide with a value of £243bn. The business is headquartered in London.
Established in 1989, the business has expanded both organically and through acquisitions. RBS WorldPay was launched as a brand in 2009 to consolidate RBS’s portfolio of successful payment brands, which includes Streamline, the leading provider of point-of-sale payment services in Europe. RBS WorldPay offers services across the entire payment value chain, including transaction capturing, merchant acquiring and transaction processing.
Today, RBS WorldPay’s clients vary in size from small family run companies to large multi-national corporations, spanning a broad spectrum of industries and sectors. The business operates in over 30 countries and has the ability to process up to 680 transactions per second in 113 currencies across 72 payment methods. It enables clients to accept card payments either at point-of-sale, mail order or over the internet on a global, efficient and secure basis.
The market for electronic payments has significant growth prospects as a result of the continuing shift from paper-based payments, such as cash and cheques, to electronic payments like credit and debit cards, the most prevalent form of electronic payment. Between 2008 and 2013, the total number of card payment transactions globally is forecast to grow at a CAGR of 10.5%. New payment methods, increasingly online, are also being adopted, with the value of eCommerce transactions between 2009 and 2013 expected to grow at a CAGR of 18.8%. Particular opportunities are anticipated in emerging markets, as their economies develop and expand.
Ron Kalifa, who will be leading the business as Chief Executive Officer, said:
“RBS WorldPay is a strong business with a leading position in its markets and I am confident that it will continue to grow and prosper under the joint ownership of Advent International and Bain Capital. I am also delighted that RBS Group will hold a minority stake in the business, providing ongoing support and helping to maintain existing relationships with our customer and supplier bases. We will continue to deliver the reliable products and first-class service that our clients have come to expect from this business and we look forward to enhancing our product offering. This is an exciting time in the ongoing evolution of our company.”
James Brocklebank, Managing Director and Head of Advent’s financial services sector team in Europe, said:
“WorldPay is a unique business and we are delighted to be supporting Ron Kalifa and his team in the next phase of its growth. Advent and Bain will be making a very significant investment in the company to enhance its technology and expand the range of products and services offered to merchants. Our long-standing specialisation in financial services and payment processing will also benefit the business as it moves forward as an independent entity.”
Robin Marshall, Managing Director, Bain Capital added:
“Bain Capital is delighted to announce this investment in WorldPay. We have unparalleled experience in large, complex carve outs of leading global businesses – experience we will bring to bear in the next phase of WorldPay’s development. We are excited to work together with Advent, WorldPay management and RBS Group in further strengthening WorldPay’s position as one of the world’s leading global acquirers.”
Since its inception in 1984, Bain Capital has made over 50 investments in the financial services and technology sectors across Europe, Asia and North America.
Advent International has been investing in the financial services sector for over 20 years and has backed more than 30 companies in a broad range of subsectors including payments, transaction processing and financial technology.
Advent International and Bain Capital were advised by Credit Suisse, Weil Gotshal & Manges, Kirkland & Ellis, PwC, FT Advisors Ltd, First Annapolis and McKinsey & Company.
About Advent International
Founded in 1984, Advent International is one of the world’s leading global buyout firms, with offices in 17 countries on four continents. A driving force in international private equity for 25 years, Advent has built an unparalleled global platform of over 150 investment professionals across Western and Central Europe, North America, Latin America and Asia. The firm focuses on international buyouts, strategic repositioning opportunities and growth buyouts in five core sectors, working actively with management teams to drive revenue growth and earnings improvements in portfolio companies. Since inception, Advent has raised €19.4bn ($25bn) in private equity capital and, through its buyout programs, has completed over 250 transactions valued at approximately €40bn ($52bn) in 35 countries.
For more information, visit www.adventinternational.com.
Payments represent a particular focus for Advent with deals including:
· Fifth Third Processing Solutions, the 2009 carve-out of a leading merchant acquirer and EFT processor in the US;
· Monext, formerly Experian Transaction Processing, a leading card processor in France which was sold to Crédit Mutuel Arkéa in 2010;
· Euronet, an independent ATM service provider, which went public on Nasdaq;
· CSU CardSystem, Brazil’s largest independent credit card administrator, which went public on BOVESPA;
· DolEx, a leading money transfer business that was sold to Global Payments in 2003;
· PaySys, a leading provider of transaction processing software which was sold to First Data Corporation in 2001;
· CCS, a leading Czech fuel card processor, sold to FleetCor in 2006.
Transaction processing investments include:
· Equiniti, the leading UK share registrar and employee share plan administrator carved-out from Lloyds TSB, in 2007;
· Xafinity, a leading UK pensions services business, in 2010;
· CETIP, the leading CSD for fixed income and OTC derivatives in Brazil, which went public in Brazil in 2009.
About Bain Capital
Bain Capital is one of the world’s leading private investment firms with approximately $67bn in assets under management and a team of over 300 investment professionals located across 3 continents and 8 offices. Since its inception in 1984, Bain Capital has made private equity investments and add-on acquisitions in over 300 companies, focusing on market leading businesses and world class management teams.
Bain Capital has a distinctly people-intensive, value-added approach to investing, with a strong emphasize on supporting management teams to drive strategic and operating improvements. The firm’s Managing Directors follow a long-standing tradition of operating as a consensus-oriented partnership, personally committing themselves at every stage of the investment process, and partnering with management to ensure the success of their portfolio companies.
For more information, visit www.baincapital.com.
Bain Capital has made over 50 investments in the financial services and technology sectors across Europe, Asia and North America, key investments including:
· Sungard, a leading integrated software and processing solutions provider;
· Fleetcor, a leading fuel/ fleet card issuer / processor;
· Applied Systems, the leading insurance agency enterprise management software provider;
· Ameritrade, a leading on-line broker;
· Instinet, a leading electronic trading network;
· Cerved/Lince, the leading Italian information services provider to financial institutions