Electronic payments are simple for consumers — a tap of the card and voila! The complexity of what happens in the background is one reason the sector is alive with deal activity. The eye-catching $43bn scale of FIS’s acquisition of Worldpay has put a spotlight on a sector that is consolidating rapidly. Mooted prices for two upcoming initial public offerings look as if they have already been caught up in this trend. The sheer number of companies operating at the various stages of multilevel payment chains is the reason for the deal spree. Global mergers and acquisitions in the sector so far this year, at more than $80bn, is double 2018’s total. Investors should expect valuations to keep rising as the land grab intensifies. Italian payments group Nexi plans to list locally with an enterprise value of up to €8.1bn. Margins of 45% are expected to produce ebitda (earnings before interest, tax, depreciation and amortisation), of €490m this year. An enterprise value to ebitda multiple of a...

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