AlphaValue Corporate Services Fundamental Analysis FR
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Keyware

CR
Bloomberg   KEYW BB
Smart Cards-Security  /  Belgium  Web Site   |   Investors Relation
The soft bet is paying off
Target
Upside 94.0%
Price (€) 1.04
Market Cap (€M) 24.5
Perf. 1W: -4.59%
Perf. 1M: 1.96%
Perf. 3M: -0.95%
Perf Ytd: -4.59%
10 day relative perf. to stoxx600: 0.40%
20 day relative perf. to stoxx600: 7.65%
M&A /Corp. Action13/01/2022

Strategic acquisition of Payment Solutions

Keyware is now strengthening its division with a strategic acquisition in Belgium that will greatly expand its portfolio


Fact

Keyware announced the acquisition of Payment Solutions, a Belgium player active in the electronic payment solutions market.


Analysis

Keyware has reached an agreement to acquire 100% of Payment Solutions’s shares. The company will continue to operate as before: no reshuffling of employees and management, as Keyware did with EasyOrder and Magellan. The arrival of the CEO of Payment solutions in the management of Keyware would therefore not be a surprise.

After focusing on the development of its software business, the company is returning to its roots with the intention to expand its customer base in the payment terminals and authorization segments. The operation will expand its existing portfolio by c. 2,500 contracts, representing growth of c.15% in the Keyware customer base. The clientele is mainly located in Flanders and Brussels.

Keyware sees major synergies (optimization of the terminal and acquiring offer), and contributions from this acquisition of k€2,300 to FY22 consolidated revenue and k€440 to FY22 EBITDA.


Impact

We will integrate the expected contributions to the revenue and EBITDA. Keyware didn’t communicate about the acquisition’s price but looking at the TSS’ valorisation (Terminal services and Solutions), c.€2.5bn for €1.2bn of sales, we estimate the multiple for the Keyware transaction at about 2x, implying an acquisition price of c. k€4,600. The company plans to communicate more about this acquisition at the time of its annual results, when we should also have more information about its financing, allowing us to integrate this into our model.


Updates

13 Jan 22 M&A /Corp. Action
Strategic acquisition of Payment Solutions

16 Sep 21 Earnings/sales releases
Back in positive territory thanks to recovery in a...

30 Mar 21 Earnings/sales releases
Change of Authorisations' partner for further pro...

16 Sep 20 Earnings/sales releases
A pivotal year for the Authorisations division

26 May 20 Earnings/sales releases
The right time to establish itself as a software pr...

18 Mar 20 Earnings/sales releases
Positioned to take advantage of increasing pow...

13 Nov 19 Earnings/sales releases
The challenge remains intact

30 Aug 19 Earnings/sales releases
Software continues to drive up the top-line

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