2023-07-17 05:32:06
(Alliance News) – Banco BPM Spa, Gruppo BCC Iccrea and FSI on Friday signed a binding agreement to establish a strategic partnership aimed at developing a new Italian and independent company in the digital payments sector.
The new company “will be a point of reference in the fintech landscape and with an approach oriented towards innovation and the growth of digitization in our country”, reads the joint note.
The agreement provides for the contribution of the electronic money activities of Banco BPM to the joint venture, with the recognition of a mixed consideration in cash and in shares issued by the Pay Holding vehicle, which in turn controls the entire capital of BCC Pay Spa, soon to be rebranded.
Following the transaction, Pay Holding will be owned approximately 43% by FSI and approximately 28.6% by Banco BPM and Iccrea Banca.
After the contribution of Banco BPM’s electronic money activities, the joint venture will be the second national operator with a market share of more than 10% in the electronic money sector, with approximately 9 million cards, 400,000 points sales and around 110 billion euros in intermediated transactions.
The agreement provides for a blocking of Banco BPM until 2026 and the usual exit mechanisms for this type of transaction. The closing of the transaction is subject, as usual, to the approval of the competent authorities.
Under the terms of the agreement, BPM will be able to preserve the current commission margins generated by the e-money business – over €140 million in net revenue in 2022, an increase of 13% compared to 2021. – while benefiting fully from their growth, “in a sector with strong development potential, as well as from the contribution of the expected profits of the joint venture and potential increases in the value of its equity stake”.
At closing, the transaction will have a positive impact on Banco BPM’s CET 1 ratio, estimated at approximately 32 basis points, including the effect of the equity investment. If we also take into account any future price increases, the effect on the fully loaded CET 1 ratio might amount to around 50 basis points.
Overall, the transaction will generate a benefit for Banco BPM of more than €2 billion in net present value terms over the time horizon of the agreement.
Par Giuseppe Fabio Ciccomascolo, senior journalist of Alliance News
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