Apollo in talks to acquire Worldline’s TSS business

Apollo is in talks to acquire Worldline’s Terminals, Solutions & Services business. The total consideration of the deal is for 2.3 billion euros. Worldline is a European payments company.

PRESS RELEASE

Paris La Défense, February 21, 2022 – Worldline [Euronext: WLN], a leader in the payments industry, has entered into exclusive talks with the Apollo Funds (as defined below) on the basis of a binding offer for the purchase of its Terminals, Solutions & Services (“TSS”) Business Line

Following the strategic review of TSS aimed at supporting its ongoing transformation and further accelerating its development, Worldline has entered into exclusive talks with the investment funds managed by affiliates of Apollo (NYSE: APO) (the “Apollo Funds”) upon receipt of a binding offer, for 100% of the shares of TSS, comprising a € 1.7 billion upfront consideration as well as preferred shares that could reach up to € 0.9 billion in value depending of the future value creation of TSS.

Worldline has entered into exclusive talks with Apollo Funds following a competitive process considering the overall quality of its offer, its strategic vision and industrial focus, its commitment to support the current TSS management and its sensitivity towards the French social context. Moreover, Apollo has a strong track-record in value creation and corporate carve-outs, with successful transformation of previously acquired businesses in France.

The contemplated transaction also encompasses the signing of a partnership agreement cementing the strategic and long-term commercial relationship between Worldline and TSS over the next 5 years.

Alongside the Apollo Funds, Worldline will remain associated to future value creation opportunities made possible by the robustness and quality of the TSS business and the transformation plan shared between the parties via the ownership of the preferred shares. This structure has been designed to align interests between Worldline and the Apollo Funds and will be directly linked to the total value creation achieved by TSS during its ownership by the Apollo Funds.

Gilles Grapinet, CEO of Worldline, said: “I am very happy to announce today that we’ve signed an agreement to enter into exclusive talks with Apollo, a highly renowned and successful global investment firm, that offers to take-over the future development of our payment terminal activity and its teams. As we communicated at the time of the acquisition of Ingenico in February 2020, we initiated a strategic review of our payment terminals business to ensure that it would have the best possible conditions to execute its ambitious transformation. Following the validation of Worldline’s Board of Directors to divest TSS in October 2021 and after conducting a rigorous process over several months, we have signed an agreement with the candidate we believe is the best fit to ensure the takeover of the business, in the best interest of its customers and employees. The TSS business, world leader in its space, has a very promising development potential and is supported by highly talented people under the strong leadership of Matthieu Destot. We trust Apollo can provide TSS with the best assets, expertise and support to ensure the pursuit of its successfully initiated transformation journey towards an “as-a-service” business model, reinforcing further its long-term success.

This announcement is a major milestone in the execution of Worldline’s strategy after the acquisition of Ingenico and numerous new acquisitions in 2021 in Greece, Italy and Sweden, strengthening its leadership position in payment services. This contemplated transaction, while being fundamentally triggered by the best interest of TSS, will also simplify our group structure, further increase our focus on our core activities and massively deleverage our balance sheet allowing the acceleration of our next strategic developments towards establishing Worldline as a truly global Paytech leader.”

Michele Raba, Apollo Partner, said: “TSS is the leading hardware player in the payments infrastructure ecosystem with a strong Ingenico brand and leading market shares across all regions of operations. We are excited about partnering with TSS’s management team to continue growing TSS in hardware, software, and services areas where there is already strong momentum. We look forward to supporting TSS in its next phase of business transformation and becoming the ecosystem enabler in the new world of payments acceptance globally. Worldline will remain a key customer for TSS and an important partner in this strategic journey.”

Matthieu Destot, head of TSS global business line, said: “We, as the TSS management team and all the TSS talents across the world, are thrilled by this announcement which is opening an exciting new era for our Terminals, Solutions and Services activities as an independent company under the Ingenico brand.
This operation marks a key milestone to accelerate the current dynamic in our already well engaged business transformation journey. From a predominantly hardware and associated services business to becoming the ecosystem enabler in the new world of payments acceptance, with a greater mix of software and cloud-based services, leveraging our latest range of Android OS-based platform (AxiumTM), our Terminal as a Service (TaaS) offering and our Payments Platform as a Service (PPaaSTM) platform.