Advent International Nears Deal for Nuvei

Advent International is advancing towards an acquisition of Nuvei, a Canadian-based fintech company that offers payment processing solutions. Nuvei went public in September of 2020, raising $700 million — the largest tech IPO in the history of the Toronto Stock Exchange. The deal size is still uncertain, but Nuvei is actively engaged in discussions about going private with major shareholders and outside advisors. The company’s TSX-listed stock jumped +32% on news of the announcement, closing March 18th at a $4 billion market cap. 

The adoption of digital payments — accelerated by online shopping and the 2020 pandemic — has been a boon for processors like Nuvei. The company’s transaction volume increased +53% YoY in Q4 2023, which resulted in strong earnings — revenue was up +46% to $322 million for the quarter, and adjusted EBITDA grew +40% to $120 million. Despite the growth, Nuvei's shares are currently trading -82% lower than their highs of 2021 as the company has been recovering from a correction in tech markets as well as a short-seller report released by Spruce Point Capital Management in April 2023. 

This is a classic target for Advent International, which is an operationally-focused buyout firm with extensive experience in technology and financial services sectors. If a deal does come to fruition, expect Advent to help Nuvei integrate recent acquisitions (such as the $1.3 billion acquisition of Paya Holdings in 2023), improving the company’s cost structure, and paying down debt. Software companies have been a major target for PE firms over the past year, and Nuvei-Paya could be seen as a tempting two-for-one deal.

In other buyout news …