Gaming company International Game Technology (IGT) will sell its Italian proximity payment business to PostePay — the payments arm of Italian postal service Poste Italiane — in a deal worth $785 million (700 million euros).
IGT announced the agreement in a news release Monday (Feb. 28), saying the deal involved the sale of LIS Holding S.p.A. and LISPAY S.p.A., wholly-owned subsidiaries that conduct its proximity payment business. IGT says it will use the net proceeds from the sale mostly to bring down its debt.
The London-based company say these businesses provide services that include bill payments and prepaid payment cards, as well as commercial services such as telco and e-vouchers top up, and technological solutions that include merchant and enterprise services.
“This transaction provides us with an opportunity to monetize IGT’s market leadership in the Italian proximity payment business at an attractive value as we continue to execute our long-term strategy,” said Vince Sadusky, IGT CEO. “Streamlining our products and solutions portfolio enables us to focus our efforts and resources on our core and strategic assets, as we position IGT for industry leadership and increased shareholder value.”
The sale price represents an enterprise value of $706 million (629 million euros) and approximately $78 million (69 million euros) of net unrestricted cash, IGT said. The company adds that its payment businesses generated about $255 million (227 million euros) in gross revenues and roughly $44 million (39 million euros) in EBITDA last year.
PYMNTS reported in January that Poste Italiane was considering the purchase, but that the deal would be worth 600 million euros ($679 million).
LIS Pay had an existing contract with Poste Italiane, providing services for prepaid debit cards issued by PostePay.
As we noted at the time, the deal provides more evidence of robust merger and acquisition movement in the payments sector, which is consolidating amid rising competition and the large technological investments it requires.
Last month saw the global payments company Payroc acquire East Commerce Solutions, a merchant service that handles $2 billion dollars in yearly processing volume.