KKR To Acquire German Digital Payments Firm Heidelpay

Gobal investment firm KKR is acquiring a majority in German payments group Heidelpay for more than 600 million euros ($668 million), according to the Financial Times.

Heidelpay Group and its majority stakeholder AnaCap Financial Partners reached an agreement on the terms of the investment from KKR, making KKR the new majority shareholder.

AnaCap had the upper hand against rival Nordic Capital and EQT from Sweden. Worldline and Nets also lost out, according to people briefed on the transaction, FT said.

M&A activity in the payments sector has been booming in recent years as digital alternatives take precedence over cash.

“We see enormous growth potential both organically and through M&A across Europe,” said KKR’s Daniel Knottenbelt. “We will draw on our deep sector knowledge, track record of working with founders, and our expertise through 20 years of investing in Germany to further shape Heidelpay’s unique profile.”

Founded in 2003, Heidelpay enables its clients to accept online and mobile payments and is used by more than 30,000 merchants, including companies such as L’Oréal. A person familiar with KKR’s strategy said the buyout group hoped to expand by adding customers in Germany.

Heidelpay expects to generate 40.5 million euros ($45 million) in earnings before interest, tax, depreciation and amortization this year, FT reported.

AnaCap Financial Partners announced in January that it signed an agreement to buy a controlling stake in Heidelpay, saying Heidelpay is attractive because it operates in a fast-growing market driven by the continued expansion of global eCommerce. The co-founders of Heidelpay and the existing management team kept a minority stake in the business.

According to AnaCap, Heidelpay is 100 percent proprietary, serves more than 14,500 primarily online businesses across the DACH and Benelux regions, and processes transactions across more than 200 payment methods.