Swiss financial services firm SIX Group AG and French payments company Worldline SA signed a binding agreement to enter a strategic partnership, under which SIX will sell its payment service unit to Worldline for a total consideration of approximately €2.30 billion.
The total consideration comprises 49.1 million newly issued Worldline shares and a cash consideration of €283 million, subject to customary net debt and working capital adjustments. The deal also includes a mechanism that could pay SIX up to €139 million in the second quarter of 2020, depending on Worldline value creation. Worldline will also acquire specific assets from SIX for a total amount of €46 million.
SIX will own 27% of Worldline as a result of the transaction, with French IT firm Atos SE to retain a majority 51% stake in the company. SIX, which also operates the SIX Swiss Exchange, will get two seats on Worldline's board of directors.
The combined entity will be the largest payments provider in Europe, SIX and Worldline said May 15. Its revenues are expected to reach roughly €2.3 billion in 2019.
SIX and Worldline will also enter a 10-year commercial contract to deliver financial processing services to the Swiss banking ecosystem. Worldline has entered into a related transaction to become a 20% stakeholder in Swiss mobile payments app TWINT AG for a €25 million investment, along with SIX and other banking firms.
The transaction is expected to be completed in the fourth quarter, subject to various works council process and customary antitrust and regulatory approvals, and following the finalization of the carve-out of SIX Payment Services from SIX Group and the approval of the issuance of the new Worldline shares.
Worldline expects to consolidate the deal in its financial statements from Jan. 1, 2019.