Brookfield to Take Majority Stake in Barclays' UK Payments Arm
Hey everyone, there’s some pretty big news in the world of finance and fintech, and it involves two major players — Barclays and Brookfield Asset Management. So, here’s the scoop: Barclays has finally reached an agreement to sell most of its British payments business to Brookfield. This comes after more than a year of trying to offload the unit, which is a huge part of the infrastructure behind retail payment processing in the UK.
Now, this isn’t just a straight-up sale. It’s a bit more complex. Barclays and Brookfield are going to set up a standalone entity specifically for this payments business. Barclays is putting in around £400 million — that’s about $528 million — into this new venture. For the first three years, Barclays will remain the sole shareholder. But, here’s where Brookfield steps in: they’ll start off with a 10% stake, and down the road, they can bump that up to around 70%, as long as certain conditions are met — including Barclays recovering its full investment.
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Eventually, Barclays expects to retain a 20% minority stake. It’s a smart move if you ask me, because it still gives them some skin in the game without fully owning an operation they no longer see as core to their strategy.
Why is Barclays making this move? Well, they’ve been saying since late 2023 that this payments unit doesn’t align with their long-term vision. Plus, the whole payments sector in Europe is changing rapidly. With competition getting tougher and the market increasingly dominated by fewer, larger players, banks like Barclays are rethinking their roles. Valuations across the sector have taken a hit, especially for companies like Worldline, Nexi, and Adyen, so finding a buyer willing to take on the operational complexities was no easy feat.
Interestingly, even though this business processes billions of pounds annually and supports both small businesses and big corporates, Barclays struggled to get the £2 billion valuation they initially wanted. Still, they’ve managed to land a deal that brings in a heavyweight like Brookfield — and that says a lot. Brookfield has a track record of making bold moves in infrastructure and financial services, so this could be a really strategic fit for them.
Barclays also confirmed this deal won’t significantly change their financial forecasts or guidance, which is probably good news for shareholders. It’s one of those behind-the-scenes moves that might not grab headlines for weeks, but it absolutely reshapes the payments landscape in the UK.
So yeah, Brookfield is stepping in, Barclays is stepping back, and the British payments sector is evolving right before our eyes. Let’s see how this one plays out — but it's a fascinating move in the ever-changing game of global finance.
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