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August 17, 2010

Advent, Bain buy RBS WorldPay for $2.7bn

Private equity firms Advent International and Bain Capital are set to acquire Royal Bank of Scotlands (RBS) card and online payment services arm, RBS WorldPay, for £2.025 billion($2.7 billion). Paying the price for its state bail out in 2008, 83 percent state-owned RBS has adhered to orders from European regulators to sell off some of its assets. The news of the sale follows Spanish bank Santanders purchase of 318 RBS branches for £1.65bn this week.

By Verdict Staff

Private equity firms Advent International and Bain Capital are set to acquire Royal Bank of Scotland’s (RBS) card and online payment services arm, RBS WorldPay, for £2.025 billion ($2.7 billion).

Paying the price for its state bail out in 2008, 83 percent state-owned RBS has adhered to orders from European regulators to sell off some of its assets.

The news of the sale follows Spanish bank Santander’s purchase of 318 RBS branches for £1.65bn this week.

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. The business processed a total of 6.8bn transactions worldwide with a value of £243bn last year.

“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,” said Ron Kalifa, who will be leading the business as CEO.

“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.” 

RBS WorldPay was launched in 2009 to consolidate RBS’s portfolio of payment brands, which includes Streamline, the leading provider of POS payment services in Europe.

According to RBS, 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.

“WorldPay is a unique business and we are delighted to be supporting Ron Kalifa and his team in the next phase of its growth,” said James Brocklebank, managing director and head of Advent’s financial services sector team in Europe.

“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.”  

The valuation includes a £200m contingent consideration, and the transaction, which is subject to regulatory approval, is expected to close before the end of the year.

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