Nexi Rejects TPG’s €1bn Offer for Its Digital Banking Unit
In a surprising turn of events, Italian payments technology company Nexi has declined an offer of €1bn ($1.17bn) from investment firm TPG for its digital banking solutions unit. This information was reported by Bloomberg.
TPG’s Binding Offer
Last month, after several months of back-and-forth discussions, TPG had submitted a binding offer for Nexi’s digital banking solutions division. This is not the first attempt to sell Nexi’s digital banking business. Earlier, there were discussions about a proposed €800m deal with Italian fund F2i. However, that too did not culminate in a sale.
Nexi’s Board Declines TPG’s Proposal
The board of directors of the Italian digital payment company reviewed TPG’s proposal in detail. After a thorough assessment, they decided not to proceed with the transaction. Nexi stated: “Following the analysis carried out, and after careful consideration, the Board resolved not to proceed with the proposed transaction.”
Objections from CDP
After TPG submitted its bid, Cassa Depositi e Prestiti (CDP), an Italian financial service provider, raised objections to the proposed transaction. CDP, which holds a 19.14% stake in Nexi, along with several senior Italian officials, opposed the sale based on the strategic importance of the digital banking division. Nexi’s division includes Italy’s national interbank network that spans over 200,000km. It provides technology for open banking, corporate banking services, and interbank clearing systems. Last year, the unit generated core earnings of €155m.
Analyst’s Take on Nexi’s Decision
Bloomberg quoted Banca Akros analyst Gabriele Venturi as saying that Nexi’s move represented a “missed opportunity to accelerate balance sheet deleveraging.” The report also highlighted that this decision adds to a series of unsuccessful banking transactions in Italy, with some deals being affected by regulatory or political factors. Examples of such instances include UniCredit’s decision to drop a bid on Banco BPM following restrictions from the Italian government, and Assicurazioni Generali’s plan to merge its asset management business with BPCE’s Natixis Investment Managers not making any headway.
Nexi’s Expansion Through Acquisitions
In recent years, Nexi has expanded its footprint through a series of acquisitions, including Nordic payments company Nets and several domestic transactions in 2020. In 2023, Nexi signed an agreement to acquire Spanish bank Banco Sabadell’s payments subsidiary, Paycomet. The decisions to reject TPG’s offer and to continue with strategic acquisitions underline Nexi’s commitment to its long-term growth and business strategy.
This information was originally published Here.
