Finance & Economics

Barclays Reportedly Considers Selling of Stake in Its Merchant-Acquiring Business

Barclays Plc is currently exploring the prospects of implementing a potentially possible decision to sell a stake in its merchant-acquiring business in the United Kingdom.

Barclays Reportedly Considers Selling of Stake in Its Merchant-Acquiring Business

This information was published by the media with reference to persons who are aware of the plans of the financial institution. Insiders reported that the lender is considering selling a stake in the business of acquiring trading services as part of actions aimed at increasing the value of the bank’s shares.

K.S. Venkatakrishnan, who currently heads the financial institution, contacted potential partners and carried out internal work on the implementation plan of the intention. This was reported by insiders who provided information on condition of anonymity and stated that this topic is strictly corporate and has not yet been identified in any way in the external space. They also said that the sale of the stake could cause the value of the whole unit to reach the level of 3 billion pounds ($3.8 billion).

The Barclays corporate development team, headed by former Morgan Stanley banker John Sandhu, contributes to the implementation of this intention. This was also reported by insiders.

Barclays is currently exploring the prospects of selling only a minority stake in the business. However, some insiders believe that this deal in the future may encourage the suitors in some sense to advertise the advantages of buying a controlling stake.

A representative of Barclays, in an email sent in response to a media request about a possible sale of a stake in the business, said that the bank does not comment on speculation. He also noted that the business of the financial institution continues to demonstrate good performance, separately emphasizing that the development of the lender’s global payment service is a priority.

The deal with Barclays Merchant Services, if the information of insiders eventually turns out to be true, and assuming that the statements of the representative of the organization were a kind of cover for the implementation of plans, will be the most aggressive action by the giant of the British banking sector to increase its valuation after the revision of the lender’s strategy, which began this year. Currently, there are many questions about the stubborn discount of a financial institution compared to similar companies.

The bank is also currently selling its consumer finance business in Germany. The media reports that this process may be completed before the end of this year.

In Europe, many lenders have refused to provide consumers with trade-acquiring services. Such services help companies to make electronic payments. These units were mostly sold by specialized payment firms or private equity funds, which combined them into larger platforms.

Some European lenders are currently seeking to monetize their payment operations. Such efforts are being made by the Spanish bank Banco Sabadell and the Italian financial institution Intesa Sanpaolo.

The Italian company Nexi SpA is a major consolidator of the European payment sector. The Worldpay merchant acquirer is currently undergoing its third change of ownership since 2018.

As we have reported earlier, Barclays Reportedly Invests in Promotion on Private Credit Market.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.