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Lyft set for an IPO and the acquisition of Worldpay

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Ride-sharing Lyft set for an IPO

Ride-sharing app Lyft is going on the road this week to convince investors to pay a big premium to buy into their loss-making company.

They are going to be doing their best to get investor pulses racing with the prospect of buying expensive shares that have one vote while the founders, who own 7% of the company will get 20 votes per share with theirs.

Lyft is more concentrated in the US and Canada versus its larger competitor Uber, which has a broader geographical footprint, and is thus far less prone to PR disasters, so maybe investors will like this.

It’ll be interesting to see whether the shares are priced at the top of the range before floating on NASDAQ or whether the company will wind its neck in a bit after investor feedback.

Uber will be watching what happens closely because their valuation will probably be used as a base for its own upcoming Initial Public Offering.

The acquisition of WorldPay

The other thing I wanted to talk about today was the acquisition of WorldPay. Fidelity National Information Services bought the rival payments processor for $43bn.

WorldPay specialises in services that enable digital payments while FIS develops core banking platforms and asset management software, among other things.

There’s a lot of consolidation in the payments processing sector at the moment as this deal comes hot on the heels of Fiserv’s $39bn acquisition of First Data in January.

Data processors need more size in order to compete with big banks on payment processing and the increase in card and online payments is intensifying this need.

This sounds like a solid deal from a strategic point of view and the premium it paid does not look too chunky at this stage.

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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