Italy is hesitant to consider a potential partnership with Worldline, as one of the options under consideration to revive Nexi, according to three sources. The resistance stems from the expectation that France, with its significant indirect stake in Nexi, would likely oppose the necessary job cuts for such a deal to succeed.
Rather than pursuing a tie-up, Italy is contemplating the possibility of taking Nexi private along with some co-investors to facilitate a turnaround away from public scrutiny and to alleviate its substantial debt burden accumulated through rapid growth via acquisitions, mentioned one of the sources.
Nexi and Worldline, Europe’s top two payments companies, did not provide immediate comments, as did Italy's Treasury in response to the sources' statements.
Despite the European Central Bank advocating for reduced reliance on non-European payment providers due to industry fragmentation, the sources familiar with the matter dismissed the likelihood of a deal due to challenges such as significant potential job cuts at Worldline and complex regulatory hurdles given the multinational operations of both companies.
With Nexi and Worldline witnessing low share prices, discussions on a potential tie-up have been explored and presented to shareholders, a sourced informed Reuters separately.
Italy has not engaged in concrete talks with France regarding the matter, either at a governmental level or between their respective investment entities. French investment agency Bpifrance holds an 8% voting stake in Worldline, while Italy's CDP increased its stake in Nexi to 18.25%.
Nexi, currently trading at around half of its 2019 IPO price of 9 euros per share, has attracted interest from private equity firms despite certain fund shareholders pondering an exit due to extended investment periods and varying entry levels.
Meanwhile, Worldline’s shares have plummeted by 91% since mid-2021 due to multiple profit warnings under the tenure of CEO Gilles Grapinet.