Worldpay: Berenberg, not surprised, downgrades to 'hold'.
(CercleFinance.com) - On Wednesday Berenberg downgraded its "buy" rating on Worldpay to "hold," even after potential US acquirers emerged.
The broker - which already said that the British pay processor would be the "perfect target for a US acquirer" - is therefore not surprised by the interest shown and the timing of the bid.
After Worldpay received offers of interest from Vantiv and JPMorgan Chase Bank, Berenberg cannot help but note that both these groups are suffering from excessive exposure to the offline US market.
Therefore, the acquisition of Worldpay would give them international ecommerce capabilities that they would be able to cross-sell to their US client base, the broker said.
Despite this rationale, some key questions are likely to remain, Berenberg adds - such as the likelihood of another bidder like PayPal or Apple and the level of the strategic premium to be paid.
The brokerage firm thinks that offers could reach 450 pence, which is its new price target.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The broker - which already said that the British pay processor would be the "perfect target for a US acquirer" - is therefore not surprised by the interest shown and the timing of the bid.
After Worldpay received offers of interest from Vantiv and JPMorgan Chase Bank, Berenberg cannot help but note that both these groups are suffering from excessive exposure to the offline US market.
Therefore, the acquisition of Worldpay would give them international ecommerce capabilities that they would be able to cross-sell to their US client base, the broker said.
Despite this rationale, some key questions are likely to remain, Berenberg adds - such as the likelihood of another bidder like PayPal or Apple and the level of the strategic premium to be paid.
The brokerage firm thinks that offers could reach 450 pence, which is its new price target.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.