Capita Offloads Payments Processing Business in £150M Deal

Capita plc (Capita) recently announced that it has agreed to sell Pay360 Limited (Pay360) to Access PaySuite, a division of The Access Group (Access) in a deal that values Pay360 at £150m on a cash-free, debt-free basis, representing a 14.3x multiple on 2021 EBITDA of £10.5m.

Taking into account cash-like and debt-like items, Capita expects to receive gross proceeds of c.£156m upon completion. The sale will help reduce indebtedness and provide additional liquidity, which together shall further strengthen Capita's balance sheet, whilst also allowing Capita to enhance its digital offerings for clients.

The complete conditions of the deal are currently expected to be satisfied in late Q4 2022.

Pay360 is a UK-based, FCA regulated payments business, offering its customers gateway and acquiring services, as well as payment solutions across the payments value chain. It has recently expanded its capabilities into payment facilitation with the launch of its Evolve platform. In 2021, the business processed £8.6bn in transaction value across 142 million transactions.

The Pay360 senior management team will be transferring with the business.

The sale of Pay360 follows a strategic review of the business by Capita and represents further progress in Capita's strategy to build a more focused, sustainable business for the long term.

Jon Lewis, Capita's Chief Executive Officer, said: "We are pleased to have agreed the sale of Pay360 to Access. We announced our intention to sell Pay360 during our half year results, as part of our strategy to simplify and strengthen Capita. The sale is a great opportunity for the new owners to help Pay360 realise its full potential, and our colleagues at Pay360 will also benefit from the focus that this change of ownership will bring. Capita will utilise the cash proceeds of the sale to benefit our digital offerings for clients and further reduce net debt. The Pay360 senior management team and employees will remain with the business as they transfer to new ownership".