European FinTech M&A 2016-17

The Payments Sector was by far the most active sector within European FinTech M&A deals, the pace of exits is no surprise given the weight of funding that has gone into the sector. RegTech deals are also on the rise, hitting a 5 year high. We are also seeing big moves in Wealth Management and Banking M&A.
Highlights 2016/2017 include:

  • Payment giant, MasterCard’s acquisition of payment platform VocaLink for £868m
  • Swedish payment pioneer Klarna acquired two German companies, leading online payment provider BillPay for £60m and a talent hire of P2P payment Start-up, Cookies App
  • Kalixa Payments Group acquired from GVC Holdings by Singapore’s global payments operator Senjo Group for £24m
  • Compte Nickel acquired by BNP Paribas £170m, you can open the equivalent of a current bank account in thousands of tobacco shops in just a few minutes. Compte Nickel gives you an IBAN and a MasterCard for €20 per year.

 

Trends:

We see the pace of FinTech M&A  accelerating as the traditional players acquire innovation to either accelerate them into the sector or to strip out costs.  Also the big tech giants like Amazon, Rakuten, Ant Financial becoming banks and FinTech pioneers such as Klarna receive their banking licences.

FinTech has also become a core investment area for Google with investments into Stripe and Veem last year, then in March this year, it launched a European Fund focused exclusively on FinTech making its first investment of £20m into Currency Cloud.

There is increasingly a long list of both banking and non banking corporate VCs who are investing into the sector, with at least 1 out of every 3 FinTech  VC backed deals including a strategic investor.

Most active banks taking big bets on FinTech include: Santander, Goldman’s, Citi, Mizuho Financial Group, JP Morgan, Mitsui, Wells Fargo, UBS, HSBC, PNC Financial Services, BBVA, ING, Capital One, Bank of China and BNP Paribas.