EML Acquires Sentenial Group & Enters The Open Banking Market In Europe
Sentenial Limited and its wholly-owned subsidiaries (“Sentenial”), and its Open Banking brand Nuapay, have been an early mover in the emerging Open Banking and Account-2-Account (“A2A”) payments sector in Europe. The acquisition broadens the EML product suite and positions EML to be able to take advantage of rapid scale growth in the Open Banking sector in Europe and to expand the capability across all regions. EML Payments Limited (ASX: EML) (S&P/ASX 200) has entered into a binding agreement to acquire 100% of Sentenial for an upfront enterprise value of €70 million (A$108.6 million), plus an earn-out component of up to €40 million (A$62.1 million).
Sentenial is a cloud-native, API-first, full-stack enterprise-grade payments company, processing 45 billion Euro per annum and is dually regulated in the United Kingdom and France.
Sentenial, and its Open Banking brand Nuapay, operate in the fast-growing European Open Banking sector and provides EML with the capabilities to manage payments across scheme (Mastercard and Visa) and non-scheme (A2A), as well as both card and non-card payments.
EML intends to expand Sentenial's best in class platform and products into the North American and Australian markets. Post-completion of the acquisition, the combined group is expected to become one of the largest FinTech enablers in Open Banking and Prepaid globally.
The combined group will process in excess of A$90 billion in Gross Debit Volume (‘GDV’). Completion of the deal is subject to regulatory approval, and the acquisition is expected to complete in late FY21.
The Sentenial acquisition aligns with EML’s Accelerator Strategy and aims to ignite the Nuapay Open Banking product's international reach and expanded growth opportunity. Combining capabilities will create a world-first platform of Card Issuance, Open Banking and Programme Management products. Sentenial is an award-winning end-to-end bank-grade payments platform whose clients include traditional international tier-one banks, payment platforms and major corporates.
The shared vision that Open Banking is an essential offering for industry impacting embedded payment solutions is an exciting synergy between both companies. EML considers Open Banking a critical and required offering within its world-class open, Payments-as-a-Platform business by providing clients and hyper-growth FinTechs with the ability to embed its payment products into their solutions seamlessly in a vast TAM.Rationale Behind The Deal
- Post-acquisition, EML will be a leading global player and one of the largest independent FinTech enablers in Open Banking and Prepaid anywhere in the world.
- Sentenial is currently connected to 1,750banks and growing across Europe.
- Nuapay is one of the only Open Banking products in the marketplace, which provides merchants with a feature-rich Open Banking solution, including complete reconciliation and batch settlement of transactions.
- With scheme payments as well as Account to Account Transfer (A2A Transfer) solutions all under one roof, EML and Sentenial are uniquely positioned to support clients. EML leads the race to mass market a single API-based platform that offers all dominant A2A Transfer payment types, including Direct Debits, Open Banking, Credit Transfers, Virtual Account products, International Bank Account Numbers (IBANs), Single Euro Payments Area (SEPA), Faster Payments Service (FPS) and Instant Payments to its partners.