Because Nexi will sell Ratepay
According to Bloomberg, Nexi evaluates the sale of the German unit “Buy now, pay later” Ratepay. Here are all the reasons.
Nexi evaluates the sale of Ratepay and takes off at Piazza Affari.
Nexi shares were up 3.6% on Thursday. The purchases come after Bloomberg rumors, according to which the electronic payment company is considering the possible sale of the German subsidiary Ratepay, inherited from the group with the acquisition of Nets. The latter provides "Buy now, pay later "On the rise among young consumers and could be valued at over a billion dollars.
The share increase gave the company a market value of approximately € 18.1 billion. For analysts, the sale would be positive for Nexi as the “buy now pay later” service can be offered through partnership, improving margins and reducing debt with a negligible impact on revenues and EBITDA.
"We do not comment on market rumors". So Paolo Bertoluzzo, CEO of Nexi, on the indiscretions reported by Bloomberg regarding the evaluations in progress.
Bertoluzzo, however, specified that the group "continues to review the portfolio of its businesses". And with the new period of the group (after Nets and Sia acquisitions) Nexi "has already started" this revision.
All the details.
NEXI EVALUATES SALE OF RATEPAY
Bloomberg revealed that the Italian payments group is conducting a strategic review of Berlin-based Ratepay and may consider a sale of the business. The unit could be valued at more than € 1 billion.
The deliberations are ongoing and no final decisions have been made, according to the people Nexi may also decide to keep the business. A representative from Nexi declined to comment.
WHAT RATEPAY DOES
Since 2019 Ratepay has been part of the Nets group, which then joined Nexi's portfolio in November 2020.
Ratepay offers online retailers a range of payment options to offer their customers. This service allows for interest-free installment payments and is delivered via popular apps that have led to skyrocketing ratings for providers such as Klarna Bank AB. These companies earn both from penalties on non-payments and from commissions paid by resellers.
THE COMMENT OF EQUITA SIM
For Equita Sim, "the news of a possible sale would be positive as the" buy now pay later "practice could be offered through partnership (for example with Klarna), improving margins and the net financial position, with a negligible impact on growth. According to analysts' estimates, which confirm the buy rating and the 20 euro target price on the share, Ratepay has a much higher rate of revenue growth than Nexi, albeit with significantly lower margins ”reports MF .
THE ANALYSIS OF BANCA AKROS
"While the" buy now pay later "niche market is enjoying impressive growth and generating high valuations for the business, – say the experts of Banca Akros – we see a significant regulatory risk and we think that Nexi's collaboration with specialized partners Bnpl fintech would be more suited to the group's strategy rather than having its own platform ". Speaking of the transaction, analysts point out that an early reduction in net debt of 1 billion would be good news for the company.
THE EVALUATION OF MEDIOBANCA SECURITIES
According to the analysts of Mediobanca Securities, who have an 'outperform' opinion on the stock, the impact of the sale of RatePay "would be negligible on consolidated revenues (approximately 3% of total revenues), on the EBITDA and on the growth profile of the group ”, But would reduce Nexi's net debt by around 20%, decreasing the leverage ratio from around 3.5-3.6x expected at the end of 2021 (Nexi + Nets + Sia proforma) to around 2.8x. “This can potentially greatly accelerate Nexi's deleverage process, allowing the group to quickly restart its M&A business. While finalizing a decision on RatePay will probably take longer ”, Mediobanca concluded.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/perche-nexi-vendera-ratepay/ on Thu, 10 Feb 2022 12:55:01 +0000.