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September 25, 2017

Payments buy up continues with $3.5bn Nets A/S deal

This payments takeover deal follows the $10 billion merger between Vantiv and UK payments leader Worldpay. Is a trend emerging?

By Tom Ball

American private equity firm, Hellman & Friedman, has begun a $5.3 billion acquisition deal with leading Scandinavian payments provider, Nets A/S.

Achieving the status of Europe’s largest leveraged takeover in close to five years, the deal reveals strong interest in leaders in the payments space.

Central to the deal are Bain Capital and Advent International, firms that previously bought Nets in 2014. Upon completion of the deal, Hellman & Friedman will command a majority of Nets, with involvement of co-investors.

Payments buy up continues with $3.5bn Nets A/S deal

Another major acquisition in the payments space came recently when payments firm Vantiv, also an American company, merged with the UK payments leader, Worldpay.

This huge deal nearing $10 billion will see the combined entity of Vantiv and Worldpay provide a strong position in both the U.S. and UK markets. With headquarters set to remain in London, Worldpay has boasted control of 40 per cent of all UK payment transactions.

At the time of this previous deal, Nets A/S also announced that it had been approached, with rumours at the time indicating that Visa and Mastercard may have shown interest. This growing theme of payment firm takeovers points to major organisations potentially looking to corner a market on the brink of dramatic digital change and development.

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Digital disruption is quickly engulfing the payments industry, with new biometric approaches even gaining a great deal of attention. UK supermarket, Costcutter, has recently engaged in the use of a device capable of mapping the veins in the finger to verify payments.

Biometrics is also being explored by Barclays bank, now allowing customers to utilise their iPhones to make payments via a Siri voice command. This initiative is targeting heightened efficiency, as there will be no need to open an app or sign in. Adding another layer of security to this process, the Apple fingerprint recognition will be required for final confirmation.

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