London FinTech PayPoint plans £70m double acquisition
Posted on November 5, 2020 by Alistair Hardaker
London payments tech business PayPoint is to acquire two card payment and card terminal leasing firms for an expected £70m, it has announced.
It intends to buy Merseyside-based card payments business Handepay, which processes £3bn annually and has leasing agreements with SME merchants for card payment terminals achieved through second acquisition Merchant Rentals, which shares an address with Handepay.
The firm said the acquisition of Handepay will create a combined national card payments business with over 30,000 SMEs, spanning the grocery, auto trade, clothing, household goods and hospitality sectors.
The acquisition, still subject to regulatory approvals, is expected in January 2021. PayPoint has extended its current financing facility of £75m to £95m to fund the acquisition.
It said Handepay comes with a “strong and experienced” management team who have built a national cards business with “broad industry reach”.
Alongside PayPoint’s existing 9,000 customer strong card payment estate, the acquisition is hoped to enhance the end-to-end customer proposition and offering, accelerating its strategy in the UK cards market and broadening its growth prospects.
Mark Latham, currently Chief Commercial Officer at Handepay, will join the PayPoint Executive Board as Card Services Director, responsible for the combined cards portfolio.
Ian Kennedy, currently Sales Director at Handepay, will join the business as Sales Director leading both the PayPoint and Handepay sales teams, reporting to Ben Ford, PayPoint’s Retail Services Director.
Andy Peake will continue as CEO of Handepay until completion, and then will act as a consultant to PayPoint.
Nick Wiles, Chief Executive Officer of PayPoint plc, said: “Our acquisition of Handepay and Merchant Rentals will significantly increase our card payments capability and broaden our SME customer base.
“Handepay has delivered a resilient performance through Covid-19, through the breadth of its customer base and strong recovery of active merchants after the first lockdown, and has a proactive plan in response to the most recent national restrictions. ”
Andy Peake, Chief Executive Officer of Handepay, said: “ I believe we’ve found the right home in PayPoint to take us to the next stage of our growth. The whole team are excited to be joining the PayPoint Group and benefiting from the scale, expertise and market leadership that they have built in omni-channel payments and technology over the last 24 years.”
PwC acted as lead corporate finance adviser and JMW legal adviser to the shareholders of Handepay and Merchant Rentals for the transaction.