US holding firm Syncapay buys Wirecard’s North America business
Wirecard’s fire sale continues as US-based holding company, Syncapay, buys its North America business.
The disgraced German payments fintech has seen a series of its businesses auctioned off following the collapse of Wirecard AG.
The North American arm, based in Pennsylvania, is a card issuer which was acquired by Wirecard from Citigroup back in 2016 for €185 million.
It employs some 200 staff, and will be known as North Lane Technologies.
Michael Jaffé, Wirecard’s administrator, announced the deal late on 22 October. The purchasing price was not disclosed.
According to an internal document seen by the Financial Times, Wirecard put the market value of its North American business at €824 million. It had hoped to receive around half of that sum in a fire sale.
In August, Jaffé estimated the value of Wirecard’s subsidiaries combined at just €100 million. So far, five of the firm’s subsidiaries have sold.
But only one – Wirecard’s Australia and New Zealand business – revealed the value of its sale. It sold for just AUD 7.8 million ($5.7 million).
Details of the Syncapay deal
The acquisition of Wirecard’s North American business marks Syncapay’s second payments investment. The first was daVinci payments, which Syncapay acquired back in 2017.
Centerbridge Partners has backed its latest acquisition. The investor will become a shareholder, alongside existing shareholders Bain Capital Ventures, Silversmith Capital Partners, MissionOG, and NYCA.
“This transaction brings together two payments leaders with complementary solutions and a significant opportunity to expand their collective market reach,” James Kirk, managing director at Centerbridge, tells the Financial Times.
The North American business will combine with Syncapay’s first acquisition, daVinci payments.
“With this transaction we have achieved an important milestone in our sales efforts in the best interest of the creditors of Wirecard AG,” says insolvency administrator Jaffé.
Wirecard flash sale so far
Since its collapse, Wirecard has seen its subsidiaries either bought off, liquidated, or put through administration pending a sale.
Paynetics, a Bulgarian end-to-end payment service provider, acquired the corporate pay-out card portfolio of Wirecard UK and Ireland earlier this month. Three years ago, Wirecard bought these customers from Citi for an undisclosed sum.
Change Financial, a US fintech listed on the Australian Stock Exchange (ASX), is in the midst of raising capital to acquire Wirecard’s Australia and New Zealand business.
The payments and card issuing firm has signed a binding agreement to acquire all the assets of the business for AUD 7.8 million ($5.7 million).
Wirecard’s UK subsidiary – Wirecard Card Solutions (WCS) – sold to PayrNet, a subsidiary of London-based Banking-as-a-Service (BaaS) provider Railsbank.
PagSeguro Internet – a wholly-owned and fully-controlled subsidiary of PagSeguro Digital – signed a binding agreement to acquire 100% of Wirecard Brazil SA.
In August, Wirecard AG terminated 730 of its employees, along with remaining board members.
These terminations, which account for more than half of its staff, affect its core business and its subsidiaries.
About 570 employees, including 350 at Wirecard’s insolvent subsidiaries, remain in employment.