Ingenico Acquisition: Key Details, Impact, and What Comes Next

Worldline's acquisition of Ingenico marks a significant milestone in the payment services industry. This strategic move positions Worldline as a leading player in Europe and the fourth largest globally. The merger enhances operational efficiencies, expands global reach, and strengthens innovation capabilities, offering comprehensive payment solutions to merchants and financial institutions worldwide.

What Is Ingenico?

Founded in 1980, Ingenico specializes in providing comprehensive payment solutions, including portable and fixed payment terminals, software solutions like AXIUM and TETRA, and value-added services such as security and maintenance. Ingenico differentiates itself with flexible payment solutions that work on any device, integrated management of payment services, and a global network of technical experts. Their innovative approach includes advanced mobile payment solutions and support for emerging trends like cryptocurrency payments.

Who Acquired Ingenico?

Worldline is a leading global PayTech provider, specializing in secure and innovative payment services. The company offers a wide range of solutions, including in-store, online, and omnichannel payment options for merchants, as well as card issuing, acquiring, and digital banking services for financial institutions. Serving 1.4 million merchants and operating in 170 countries, Worldline processes over 43 billion transactions annually, solidifying its position as one of the largest payment service providers worldwide.

When Was Ingenico Acquired?

Worldline announced its acquisition of Ingenico on February 3, 2020, and completed the transaction on November 4, 2020. This acquisition occurred during a period of significant consolidation in the payment services industry, driven by the need for larger, more competitive entities to adapt to evolving consumer habits and technologies. The merger positioned Worldline as the largest merchant acquirer in Europe and the fourth largest globally, enhancing its market presence and operational capabilities.

Why Was Ingenico Acquired?

• Market Expansion: The acquisition significantly broadens Worldline's market presence, particularly in North America, where it previously lacked a major foothold. This move provides immediate access to the US market and strengthens its position in Latin America and Asia-Pacific. Additionally, the merger consolidates Worldline's leadership in Europe, enhancing its commercial advantages for multinational merchants.
• Technology Integration: The merger leverages the technological strengths of both companies, offering state-of-the-art integrated payment solutions. Worldline gains access to Ingenico's advanced payment terminals and innovative solutions, enhancing its capabilities in areas like account-based and instant payments. The combined R&D investment exceeds €300 million, driving further innovation and product development.
• Competitive Advantage: The acquisition positions Worldline as the largest merchant acquirer and payments processor in Europe and the fourth largest globally. This scale provides significant cost advantages and operational efficiencies, expected to generate €250 million in synergies by 2024. The combined entity offers unmatched coverage of the payments value chain, strengthening its competitive position against larger American rivals.

Acquisition Terms

• Acquisition Price: The implied Ingenico equity value is €7.8 billion ($8.7 billion).
• Payment Method: Ingenico shareholders will receive 11 Worldline shares and €160.5 in cash for 7 Ingenico shares. There is also a secondary offer of 56 Worldline shares for 29 Ingenico shares, translating into an offer price of €123.10 per Ingenico share.
• Key Conditions or Agreements:
  • The transaction is subject to customary closing conditions, including regulatory and merger control clearances.
  • Ingenico has agreed to a customary no-shop undertaking.
  • Termination fees are specified: €100 million if Ingenico breaches the agreement, and €200 million if Worldline breaches the agreement.
  • The transaction requires Worldline to acquire at least 60% of Ingenico’s share capital on a fully diluted basis.
  • The transaction is expected to close during the third quarter of 2020.
  • Regulatory approval was required and received for the merger.
  • Gilles Grapinet, Worldline's CEO, will lead the combined company, and Bernard Bourigeaud, Ingenico's chairman, will become the non-executive chairman.

Impact on Ingenico

The acquisition of Ingenico by Worldline has led to significant changes in operations and management. Gilles Grapinet, Worldline's CEO, now leads the combined entity, while Bernard Bourigeaud, Ingenico's Chairman, serves as the non-executive chairman. The merger has resulted in a workforce of 20,000 employees across 50 countries, integrating Ingenico's expertise in payment terminals with Worldline's digital payment solutions. This strategic alignment aims to support clients, merchants, and banks with state-of-the-art electronic payment services, enhancing operational efficiencies and global reach.

Product offerings and services have also seen substantial enhancements. The merger has expanded the range of digital payment capabilities available to merchants, including advanced technology and integrated payment solutions. Worldline now offers a comprehensive suite of services, from online payments and omnichannel solutions to issuing, acquiring, and digital banking. Employee reactions have been positive, with a shared commitment to sustainable growth, while customer feedback highlights the benefits of enhanced cross-border payment solutions and faster onboarding processes. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly, ensuring a smooth and efficient transition.