Nuvei, a Montreal-based payments services company, said Sunday it’s reviewing a transaction proposal from a third party and has formed a special board committee to consider “strategic alternatives.”
The “potential transaction” being reviewed would include ongoing ownership by major shareholders, including the company’s CEO, Phil Fayer, who is also Nuvei’s chair and founder.
Boston-based private equity firm Advent International is in “advanced talks with Nuvei” about a transaction, the Wall Street Journal reported Saturday, citing unnamed sources. The paper also noted that movie star Ryan Reynolds is an investor in Nuvei. A spokesperson for Advent declined comment.
Nuvei “confirms that, in connection with expressions of interest received by the Company, the board of directors of the Company formed a special committee of independent directors” to consider its options, Nuvei said in a Sunday press release. “The Special Committee is continuing its evaluation of the proposals received to date and the strategic alternatives available to the Company, and no decision has been made at this time whether to pursue a transaction or maintain the status quo.”
Nuvei said in the release that it would decline to comment beyond that statement, also noting that “it has not entered into any agreements or understandings to effect a privatization or similar transaction,” and there it gave no assurances it will do so.
The fintech enables merchants to accept a variety of payment types, from cards to crypto. It also offers payout options, card-issuing services, and fraud prevention tools. Last year, it expanded its services by buying the Atlanta-based payments company Paya for $1.3 billion, adding integrated payments for business-to-business, healthcare, nonprofit and education verticals.
“We continue to believe that Nuvei should benefit from the growth of e-commerce and is differentiated by its highly flexible technology platform, global focus, product set, and customer service,” analysts at the financial firm William Blair said in a note to investors Monday, commenting on Nuvei’s disclosure.
The possible bid for Nuvei comes at a time when the payments industry has been moving toward consolidation, after a period in which increased venture capital funding and e-commerce expansion during the COVID-19 era led to a proliferation of businesses in the arena. Now, as investors pull back on providing money to startups without profits and inflation keeps a lid on consumer spending, the industry is primed for acquisitions.
So far this year, the biggest deal to be announced is Capital One’s proposed acquisition of the card company Discover Financial.
Management of another payments company, Shift4, reportedly sent a memo to its employees Friday saying that it had scotched a potential sale of the company because the price being offered was too low, according to a report from the news outlet Bloomberg.
There are additional potential targets. Payments software company Flywire; cross-border payments firm Remitly; e-commerce payments company Payoneer; cross-border payments company Euronet; and card-issuing fintech Marqeta could be in buyers’ sights, William Blair analysts wrote in a Jan. 2 note to investor clients.
Other companies, including Fiserv and Adyen, have said they’re open to making acquisitions. Merchant services provider Worldpay, now majority-owned by private equity company GTCR following a stake sale by Fidelity National Information Services, has also signaled it could be a buyer.
On the flip side, some companies, including PayPal and Global Payments, have said they’re potentially planning to pare operations. In January, card network American Express said it’s selling fraud services company Accertify to tech-focused private equity firm Accel-KKR.
