Tyro payments [ASX:TYR] confirmed takeover overtures from ‘several parties’ including Westpac Banking Corporation [ASX:WBC].
TYR stressed that none of the approaches are ‘sufficiently definite or advanced to warrant further disclosure’ at present.
This follows news last month that Tyro rejected a takeover offer by Potentia Capital Management, calling it ‘opportunistic.’
Last week the fintech announced it would be raising its FY23 guidance on strong transaction value growth and cost reductions.
While TYR shares have been down 60% over the past 12 months, they have rebounded by 160% since June 2022.
Source: tradingview.com
Westpac and Tyro acknowledge talks
A month after knocking back a bid from Potentia Capital, Tyro and Westpac both acknowledged in separate announcements to the market that they have engaged in preliminary talks.
This follows the Australian Financial Review’s ‘Street Talk’ column first breaking the story on Monday.
Westpac is interested in acquiring TYR to strengthen its ‘small business proposition.’
In a brief update, WBC said bringing Tyro into the Westpac fold could enable the bank to ‘better support customers and grow merchant acquiring, particularly in the hospitality and healthcare sectors.’
Yesterday, the ‘Street Talk’ column revealed that Westpac hired investment bank JPMorgan to quantify the financial rationale for the takeover.
The column reported that WBC is already Australia’s second-largest payments terminal provider.
Incorporating Tyro’s terminal could put Westpac top of the pile, surpassing Commonwealth Bank of Australia [ASX:CBA].
Tyro followed Westpac’s suit in responding to AFR’s reporting, stating on Tuesday:
‘The Company confirms it has received approaches from several parties expressing interest in a potential change of control transaction, including Westpac Banking Corporation.
‘None of these approaches are sufficiently definite or advanced to warrant further disclosure at this time. Tyro is engaging in preliminary discussions with selected parties in the context of maximising value for all shareholders.
‘The Company notes that these approaches are non-binding and highly conditional in nature, and there is no certainty that a binding offer or a transaction of any kind will eventuate.’
Westpac may be eyeing Tyro, but it’s not the only one.
A few Australian banks are mulling over what Tyro’s business might bring to their tables.
NAB and Commonwealth Bank are also believed to have been looking into Tyro’s prospects, though no known move has yet been made by either.
Bendigo Bank is also in the mix, already attached to Tyro as a business partner, contributing 15% of TYR’s overall gross transactions.
Some other exciting fintech stocks
While the fintech sector has been beaten down in 2022, the recent bounce from Tyro shows there is still interest in the sector.
Fintechs can still provide value opportunities – at the right price and with the right growth prospects.
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Our market expert Ryan Clarkson-Ledward has done the necessary research required for discerning these.
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Regards,
Kiryll Prakapenka,
For Money Morning
