Canadians win £2bn bidding battle for payments processor

The Canadian investment giant led by Mark Carney has won a £2.2bn bidding war for payments company Network International.

Brookfield Asset Management has agreed to buy the credit card processor in a deal of 400p per share – a 64 per cent premium to the group’s value before the takeover battle started in April.

The bid trumped a rival proposal from 387p-a-share from a consortium that included private equity giant CVC Capital Partners.

The proposed takeover by Brookfield, chaired by former Bank of England Governor Carney, stems from frenzied interest in British companies.

A host of targets were snapped up after Covid hit in what has been dubbed “pandemic looting” as predators pounded companies with bombed share prices. Last week, veterinary drug maker Dechra Pharmaceuticals agreed to a £4.5bn takeover led by Swedish private equity firm EQT.

London’s status as a global financial center has also been called into question by the decision of Cambridge chip designer Arm to go public in New York, and a move by £29bn building materials firm CRH from the City to Wall Street.

Analysts said the purchase of Network International, the largest payment provider in the Middle East and Africa, and its imminent removal from the London market was a further setback.

Danni Hewson, an analyst at AJ Bell, said: ‘It’s a good deal for shareholders if you look short-term, but again, this is a London-listed company with a hefty price tag. It’s exactly the kind of business London wants to attract more of and losing it will rub some more salt in a festering wound.’

It’s not all doom and gloom, however, as chemicals giant WE Soda and fintech firm CAB Payments opt to list in London this week. CAB appears to be valued at £1 billion, while WE Soda, the world’s largest producer of natural soda ash for glass and batteries for electric vehicles, could be worth as much as £7 billion.

The Brookfield swoop puts Carney in the spotlight alongside Sir Ron Kalifa, Chairman of Network International and author of a review for the Government in 2021 on how to boost the UK fintech sector. Kalifa is set for a £2.4 million post-acquisition payout, having joined Network in 2019.

Critics have urged ministers to do more to strengthen London’s position as a leading global financial centre. But City Secretary Andrew Griffith this week hit back at critics who mocked the pace of reform.

Six months after Chancellor Jeremy Hunt launched the so-called ‘Edinburgh reforms’, which are designed to bolster the UK’s status as a financial centre, Griffith told the Mail: ‘This is a bumper package for the sector and – although some armchair generals are determined continue to comment from the sidelines – we are implementing reforms that will maintain our status as a leading center in the world.”