Italian bank BPER gets offer from NEXI for merchant payment arm

MILAN (Reuters) -Italian bank BPER Banca said it had received a non-binding offer for its merchant payment business from fast-growing payments giant NEXI, which one source earlier said could be worth around 350 million euros ($397 million).

BPER, Italy’s fifth-largest bank, said it had given NEXI two months exclusively to submit a binding offer. Italy’s NEXI already runs BPER’s shop payments services through a commercial partnership.

The deal is part of NEXI’s strategy of buying the payment assets of its banking partners, while keeping contracts in place with the lenders so as to pocket the operating fees in full.

Earlier this week, a person close to the matter said the BPER deal could be worth around 350 million euros.

Equita SIM analyst Gianmarco Bonacina calculated in a report that applying to that price tag the multiples seen in the Intesa and UBI deals agreed in preceding years, additional core profit for NEXI would be around 35 million euros a year.

Conversely, BPER would lose the same amount in terms of operating profit, or 3% of the total. It could boost its core capital by up to 60 basis points thanks to the expected capital gain, Bonacina said.

Given that NEXI already operates BPER’s merchant payments system, its domestic market share would not increase or breach antitrust limits, the analyst added.

“The news would be positive in terms of strategy for NEXI because ongoing consolidation among Italian banks poses risks for the group when it doesn’t own lenders’ merchant books,” Equita said.

NEXI struck a 1-billion-euro deal in 2019 with Intesa Sanpaolo, securing the merchant payment business of what is now Italy’s biggest bank. When Intesa took over smaller rival UBI the following year, NEXI bought the latter’s merchant acquiring arm.

NEXI has also bought the retailers’ payments operations of troubled lender Monte dei Paschi di Siena and Carige, as well as those of Deutsche Bank in Italy.

Rothschild is advising BPER and Deutsche Bank NEXI.

($1 = 0.8818 euros)

(Andrea Mandalà, editing by Valentina Za and Elaine Hardcastle)