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International online gambling payment processor Paysafe Group Holdings is preparing for its US public market debut following a $9 billion dollar merger.
News broke on Monday that a ‘special purpose acquisition company’ (SPAC) called Foley Trasimene Acquisition Corp II announced that it had come to terms on a US $9b deal to merge with the with London-based Paysafe, allowing the payments firm to list on the New York Stock Exchange under the ticker symbol PSFE. The deal will include debt, said the people, who asked not to be identified because the details are private.
According to sources, the SPAC is set to raise more than US$1 billion in new equity to support the transaction, Also, a deal could be announced as soon as this week though no agreement has yet been finalized. There was also mention the timing could change, or talks could fall apart. Bloomberg News last month reported talks about a deal were underway.
Valued at US$9 billion, the deal would be among the largest blank-check mergers this year, only ranking behind MultiPlan’s US$11 billion merger with Churchill Capital Corp III, and United Wholesale Mortgage’s pending US$16 billion merger with Gores Holdings IV Inc.
The entity, Foley Trasimene is led by investor Bill Foley, whose significant holdings include Fortune 500 insurance firm Fidelity National Financial along with the National Hockey League’s Vegas Golden Knights. The SPAC listed on the NYSE in August after raising nearly $1.5b.
Blackstone Group and CVC Capital Partners as private equity groups will remain Paysafe’s largest investors following the NYSE listing. The impact of the deal could potentially double to triple their investment.
This type of deal involving a SPAC follows the pattern of similar successful opportunities that have recently accelerated Golden Nugget, DraftKings, Rush Street Interactive, and other companies within the online gaming landscape. As their stock prices currently boom, it seems the sky has no limit and opportunities abound.
London-based Paysafe, acquired by Blackstone and CVC for approximately 3 billion pounds (US$5.34 billion) in 2017 offers payment processing services that enable companies to accept credit cards, cash, and direct-debit transfers online. It also offers prepaid cards and digital wallets.
The company operates through brands including Income Access, Paysafecard, Skrill, and Neteller.
Foley Trasimene Acquisition Corp II raised US$1.47 billion in an IPO in August. Its shares closed Friday at US$10.62, giving it a market value of US$1.95 billion. Foley himself has a track record of SPAC mergers in the financial services sector. One of his prior vehicles teamed with Blackstone to buy the insurer Fidelity & Guaranty Life for US$1.84 billion in 2017.
CEO Philip McHugh of Paysafe will remain in his position following the sale and told Reuters that the company would look to expand its US sports betting reach, in part by acquiring some rival payment firms.
Most recently in July, Paysafe acquired US-based operator Openbucks, which allows online merchants to accept retail gift cards as payments vs. credit card transactions.
Last month Paysafe also appointed Scott McClintic as Senior VP iGaming Product and Strategy. McClintic was formerly Chief Product Officer at Penn National Gaming’s Barstool Sportsbook.
Larry Gibbs is both a seasoned journalist and a respected online gaming industry consultant. His wry commentary & sharp analysis have appeared in numerous top gaming and sports wagering publications. He has also served as Vice President of US Gaming Services, a marketing research organization with 15 years of experience in US online wagering. He has spoken at noted gaming industry conferences including G2E, GiGSE, and NCLGS.
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