TPAY, a MENA-based online payments business with its own proprietary platform, is rumoured to have been put on the market by its venture capital owners who are seeking to capitalise on the significant growth achieved since it was founded in 2013, a source close to the deal revealed.
Launched three years ago in a largely unbanked region, TPAY currently has five million subscribers and recently launched with Google Play. The company is forecasting $100m of transaction spend in 2018 and projecting $6m EBITDA in 2018.
TPAY operates in the global, fast-growing payments market with revenues predicted to rise from c.$1.8 trillion in 2014 to c.$2.3 trillion in 2019, according to McKinsey.
The digital payments industry continues to be disrupted due to regulatory developments, technological advancements and changing consumer behaviours. These drivers have created opportunities for new market entrants such as TPAY to disrupt the traditional payment processing landscape.
Furthermore, the business has taken advantage of high smartphone adoption rates in recent years and has become a dominant player in the MENA region, with plans to expand to additional developing countries in 2018.
Sources close to the situation say the company has received several unsolicited approaches from potential buyers, including the likes of Bango, Hellman & Friedman, Boku, NTT DoCoMo Inc and technology-focused private equity firms. Online payments is a major growth sector, with companies such as Bango – the UK public market equivalent – having their stocks valued at 40x revenue.
A transaction of this kind would follow the ongoing consolidation in the high-growth payments market, including Hellman & Friedman’s acquisition of Nets and Vantiv’s clinching of an £8bn take-over of the UK-based Worldpay in September.
London-based Cavendish Corporate Finance has been appointed to advise on the sale.