Pay it forward

7 December 2020 By John Foley Follow @johnsfoley

Payments company Paysafe is merging with a listed acquisition vehicle, while owners Blackstone and CVC halve their stake and extract $2.3 bln of cash. The cost to them is that they’ll leave roughly 15% on the table. Even so, it’s easy to see why SPACs tick private equity’s boxes.

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Payment firm Paysafe plans to merge with a listed special-purpose acquisition company backed by financial investor Bill Foley, creating a partial sale for its current private equity owners, Blackstone and CVC. The deal, announced on Dec. 7, values Paysafe at $7.2 billion, or $9 billion including debt.

Blackstone and CVC bought Paysafe in 2017 for around $4.7 billion including debt and fees. The company offers digital payments systems for small businesses and gaming firms, and is set to make $1.4 billion of revenue in 2020, according to a company presentation.

Foley Trasimene Acquisition Corp II will contribute $1.5 billion of cash, most of which will be used to pay down Paysafe’s debt. A new group of investors will also invest $2 billion in equity. Blackstone and CVC will extract $2.3 billion in cash, while retaining a 46% stake.

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