Worldline Plans €500 Million Share Sale to Back Turnaround
(Bloomberg) — Worldline SA’s stock swung sharply after the company announced a €500 million ($576 million) capital raise to strengthen its balance sheet and give its turnaround plans breathing space.
The transaction will “back the execution” of Worldline’s fresh strategy, which it presented simultaneously, the firm said in a statement Thursday, confirming an earlier Bloomberg News report. It consists of an investment by three French lenders of about €110 million and a subsequent rights issue of about €390 million.
The share sale will strengthen “Worldline’s financial structure at this pivotal moment,” Chief Executive Officer Pierre-Antoine Vacheron said in the release on Thursday.
The French company has been struggling to win back investor confidence after allegations were made in several investigative newspaper reports earlier this year that it had turned a blind eye to fraud. The reports claimed that the firm continued to do business with high-risk customers in recent years, effectively enabling some fraudulent transactions to continue.
French lenders Bpifrance, Credit Agricole SA and BNP Paribas SA have agreed to participate in a €110 million equity raise at €2.751 per share, leaving them with stakes of 9.6%, 9.5% and 7.9% respectively. Worldline will then raise another €390 million through a rights issue open to all shareholders.
Worldline shares were trading at €2.05 euros at 11:23 a.m. in Paris, having earlier fallen as much as much as 12.3%. That gives it a market value of around €586 million.
Worldline has “critical infrastructure in payment services,” BNP Paribas Chief Operating Officer Thierry Laborde said in the release, explaining the reasoning behind the investment.
Analysts broadly welcomed the capital increase while flagging the firm’s guidance as disappointing. JPMorgan analyst Craig McDowell said the transformation plan looks challenging with investors likely to be cautious given the financial metrics are expected to improve only after 2026.
The stock exchange operator SIX Group AG, which Worldline’s website lists as its biggest shareholder, won’t be participating in the capital increase, the Swiss firm said in a separate statement on Thursday. SIX also disclosed that its full-year results will include a hit of about 550 million Swiss francs ($680 million) linked to its existing stake in the French company.
The announcement from Worldline is part of an investor day where the firm outlined a new strategic plan. As part of that, the firm vowed to “simplify” its operating model and achieve annual cost savings of about €210 million by 2030.
Worldline’s financial targets also include:
~4% revenue average annual growth in 2027-2030, reaching ~5% at the end of the plan Around €1.0 billion EBITDA by 2030 Positive free cash flow as early as 2027 (Adds details throughout)
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