Istituto Centrale delle Banche Popolari
Italiane (ICBPI) is in advanced talks to buy CartaSi, Italy’s
largest card issuing and acquiring business – and could complete
the deal by October.
Italiane (ICBPI) is in advanced talks to buy CartaSi, Italy’s
largest card issuing and acquiring business – and could complete
the deal by October.
The bank will conduct final due diligence on
CartaSi, valued at between €300 million-400 million ($461
million-$615 million), in the last week of August, according to a
CI source. Intesa Sanpaolo and UniCredit, which have stakes of 42
percent and 9 percent respectively, are likely to sell their
holdings. Some banks with smaller stakes may also sell.
CartaSi, valued at between €300 million-400 million ($461
million-$615 million), in the last week of August, according to a
CI source. Intesa Sanpaolo and UniCredit, which have stakes of 42
percent and 9 percent respectively, are likely to sell their
holdings. Some banks with smaller stakes may also sell.
Contrary to an Italian newspaper report, Cards
International understands Banca Monte dei Paschi di Siena (BMPS)
will not be involved in the deal and will maintain its minority
24.4 percent holding. BMPS said it was “evaluating its position in
CartaSi”. CartaSi declined to comment and ICBPI was
uncontactable.
International understands Banca Monte dei Paschi di Siena (BMPS)
will not be involved in the deal and will maintain its minority
24.4 percent holding. BMPS said it was “evaluating its position in
CartaSi”. CartaSi declined to comment and ICBPI was
uncontactable.
The source said ICBPI wants to merge CartaSi
with its ‘Key Client’ subsidiary, which was set up to incorporate
the BankAmericard corporate cards business it acquired in 2007 from
Deutsche Bank.
with its ‘Key Client’ subsidiary, which was set up to incorporate
the BankAmericard corporate cards business it acquired in 2007 from
Deutsche Bank.
CartaSi is an interbank organisation which
issues, acquires and provides back-office operations and services
to 800 Italian banks, including Intesa Sanpaolo, UniCredit, BMPS
and BancoPosta, the Italian post office bank. But Intesa no longer
issues cards through CartaSi, and UniCredit is preparing to bring
its operations in-house as it develops ‘card factories’ in Milan
and Turkey.
issues, acquires and provides back-office operations and services
to 800 Italian banks, including Intesa Sanpaolo, UniCredit, BMPS
and BancoPosta, the Italian post office bank. But Intesa no longer
issues cards through CartaSi, and UniCredit is preparing to bring
its operations in-house as it develops ‘card factories’ in Milan
and Turkey.
Francesco Burelli, a cards and payments
specialist at AT Kearney in London, said the Italian market has
started to shift away from a centralised model.
specialist at AT Kearney in London, said the Italian market has
started to shift away from a centralised model.
He said things started changing seven years ago
when domestic banks began looking differently at cards and foreign
companies began to move in.
when domestic banks began looking differently at cards and foreign
companies began to move in.
Burelli added: “They started breaking away from
issuing, acquiring and processing consortiums in search of
differentiation and increased control over their payments
operations.”
issuing, acquiring and processing consortiums in search of
differentiation and increased control over their payments
operations.”
CartaSi issued around 1 million new cards in
2007, bringing its total number of cardholders in Italy to 7
million, according to Cards International research on the Italian
cards market (see CI 400). It has a 43 percent market share of the
16.2 million credit cards in issue in Italy.
2007, bringing its total number of cardholders in Italy to 7
million, according to Cards International research on the Italian
cards market (see CI 400). It has a 43 percent market share of the
16.2 million credit cards in issue in Italy.
It is also the largest acquirer in the Italian
market, with around 50 percent of the domestic industry. In 2007,
the business managed over 485 million transactions for a volume
total of €45.2 billion.
market, with around 50 percent of the domestic industry. In 2007,
the business managed over 485 million transactions for a volume
total of €45.2 billion.
The deal is likely to alter the tangled
web of relationships within the Italian payments and processing
industry. There are potential implications for processor SIA-SBB,
which has itself been put up for sale. It is rumoured CartaSi’s
card transactions, which are currently processed by SIA-SSB, could
be switched to Equens, with which ICBPI has a joint venture through
its wholly-owned subsidiary, Seceti.
Italy’s merchant acquiring industry has become
a hotbed of bid speculation in recent months. Some shareholders are
also looking to sell their stakes in processor SIA-SBB. It was
reported in June that Atos Origin was looking at buying the
business.
a hotbed of bid speculation in recent months. Some shareholders are
also looking to sell their stakes in processor SIA-SBB. It was
reported in June that Atos Origin was looking at buying the
business.
Marzio Pividori, principal at AT Kearney Milan,
said the market’s potential was starting to attract a range of
potential buyers.
said the market’s potential was starting to attract a range of
potential buyers.
Pividori said: “Italy is one of the many
payment markets that has been growing in the last few years.
payment markets that has been growing in the last few years.
“Growth potential includes volumes with stable
or nearly stable margins. As a result, many players have been
looking at it, including domestic and international private equity
funds.”
or nearly stable margins. As a result, many players have been
looking at it, including domestic and international private equity
funds.”
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