Worldline continue acquisition spree with purchase of Greece’s Cardlink

Worldline has announced the signing of a bidding agreement for the acquisition of 92.5{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of the share capital of Cardlink, the leading Network Services Provider in Greece.

Greece: an attractive payment market

With a cash penetration that remains high and a card transaction rate per capita more than twice below European countries average, the Greek market shows attractive growth opportunities with a growing addressable market driven by the shift from cash to card and electronic payment adoption.

These favourable dynamics will continue thanks to strong underlying trends such as a positive macroeconomic environment (GDP growth, drop in unemployment, and regulations encouraging electronic payment), PSD2, open banking development (Banks connection to large ecosystems through APIs), and evolution of payment product offering (integrated POS, e-invoicing or advanced analytics).

Furthermore, the online and e-commerce development offers a strong growth potential with increased internet access for citizens over the past five years, rapidly transforming consumer behaviour towards digital economy and online shopping becoming a standard in consumer habits, further boosted by Covid-19 related lockdowns.

As an additional very compelling characteristic, it is reminded that tourism is one of the most important sectors of the Greek economy and a key pillar of its economic growth.

With more than 34 million tourists in 2019, Greece has established itself as one of the most visited countries in Europe and in the world for years.

This represents a very attractive feature of the Greek payment market offering numerous additional growth opportunities in a post-Covid context by leveraging the very rich Worldline portfolio of travel and hospitality solutions.

“The acquisition of Cardlink is a significant development in our Group consolidation strategy in Europe, extending our merchant services activities towards the South of Europe,” says Gilles Grapinet, Worldline’s Chairman and CEO.

Thanks to this transaction, we indeed benefit from a leading network services provider position in the fast-growing Greek market, driven by the ongoing adoption of electronic payments. This transaction offers attractive development opportunities for Worldline in the coming years and a strong footprint to further expand Cardlink presence in Greece.”

Acquisition of Cardlink

Founded in 2004, Cardlink is the leading Greek Network Services Provider (NSP) with an above 240,000 POS fleet (46{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of POS transactions), managing ca. 500 million of transactions a year (53{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} MSV market share). The company also provides more than 10,000 online merchants with strong value-added services through the Cardlink check-out offering.

Cardlink is a well-recognised and regarded payment acceptance leader in Greece with:

• The largest multi-acquiring POS platform acceptance network;
• A long-term relationship with major systemic banks in Greece among which Alpha Bank and Eurobank, and;
• A strong and experienced management team.

The key financial impacts

• Additional annual revenue of c. € 40 million at closing with expected double-digit organic growth CAGR over the next 4 years;
• OMDA margin of c. 35{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} expected at closing with upside potential driven by revenue growth and operating leverage;
• Estimated cash-out of c. € 130 million at closing (for 92.5{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} ownership), preserving Worldline’s financial flexibility and based on an c.11x EV/2020 OMDA multiple;
• Investment of the CEO that will keep a 7.5{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} ownership in Cardlink;
• Customary minority buy-back mechanism through a call option exercisable by Worldline (5 years after closing), and;
• Closing expected in H2 2021, subjected to satisfaction of customary condition precedent.