Are you a client?
Sign in to view the full news archive.
Last week, we commented on the latest developments regarding the Bank of England’s digital pound experiment. And that’s not the only currency-related news to catch our attention, after De La Rue – the firm responsible for printing the UK’s banknotes – accepted a takeover offer worth £263m from Atlas Holdings, a US private equity firm.
Why De La Rue and why now? The company’s foundations are solid, with a history stretching back to 1821, an extensive client base of central banks, governments and commercial enterprises, and a listing on the London Stock Exchange since 1947 (which will come to an end). The business is broadly divided into two areas, currency and authentication, but this bifurcation is set to cease, with Atlas owning the former and Crane NXT (a Connecticut-based technology company) having agreed to purchase the latter for £300m.
Ker-ching. That’s a cool £563m generated (assuming both deals conclude as anticipated) and represents the culmination of the transformation strategy which began on Clive Whiley’s watch after he joined the firm in May 2023. However, before the champagne corks start popping and backs get slapped in boardrooms on both sides of the Atlantic, let’s remember that De La Rue’s currency operation revenue declined by 18.7% to £207.1m. By contrast, revenue from authentication grew by 12.5% to £103.2m.
On face value, Crane NXT is getting the better deal (albeit by paying a higher purchase price), but Atlas believes it “will be able to focus on the optimal long-term strategy for De La Rue” without being under the spotlight as a publicly-quoted company.
PE firms spend money to make money, and the Atlas ownership of De La Rue could be short or long, depending on where it sees the value in the road ahead. But at some point, it will cash out.
Posted by: HotViews Editor at 09:00
Tags:
acquisition
currency