PayPoint to sell its Romanian business to Innova Capital
Paypoint plc (LON:PAY) today announces that it has signed an agreement to sell its Romanian business, PayPoint Services SRL and PayZone SA (“PayPoint Romania”), to Innova Capital.
The cash consideration is expected to be around £47 million based on current exchange rates on a debt free cash free basis, subject to a net working capital adjustment on completion. The sale is consistent with PayPoint’s focus on its key strategic priorities and the delivery of enhanced growth and value in its core UK markets, which is where the net proceeds will be invested.
PayPoint has been operating in Romania since 2007, where it has partnered with local retailers through about 19,000 sites to enable people to make cash bill payments, money transfers, road tax payments and mobile phone top-ups. In the financial year to end-March 2020, PayPoint Romania delivered gross revenue of £69.7 million, adjusted EBITDA (before non-recurring revenues and costs) of £7.3 million and a profit before tax of £6.8 million. The gross assets of PayPoint Romania at March 31, 2020 were £48.5 million.
The sale is subject to competition and regulatory approvals, as well as other conditions precedent. The completion is anticipated to take place on March 31, 2021.
Nick Wiles, Chief Executive Officer of PayPoint plc, said:
“Consistent with our strategic priorities, we are pleased to have agreed the sale of PayPoint Romania. The Romanian business has been part of the Group for 13 years and I would like to thank the Romanian management team and employees for their contribution to PayPoint over this time. We have decided to sell the Romanian business to focus on our core U.K. markets and the delivery of our strategic priorities for future growth in these markets. We believe that Innova is the right owner to take the business forward and we wish PayPoint Romania and Innova well for the future. We will update on the sale in due course.”
Ernst & Young LLP acted as lead financial adviser and Mills & Reeve LLP as legal adviser to PayPoint on the sale.