Italian bank Intesa Sanpaolo SpA agreed to sell its payment systems business to Nexi SpA for €1 billion, the bank said in a statement.
Intesa will transfer the business comprising 380,000 points of sale, or retail outlets, to a Nexi unit and in return receive shares in the subsidiary.
It will then sell those shares to Nexi and use some of the cash consideration to acquire a 9.9% stake in Nexi from Mercury UK Holdco Ltd. for €653 million.
The transaction is expected to complete in 2020, subject to customary and regulatory approvals. The sale is expected to result in a net capital gain of roughly €900 million in the 2020 consolidated income statement of Intesa.
Nexi said in a separate statement the transaction would generate an increase in group EBITDA of about €95 million and a high teens increase in cash earnings per share starting from 2020.