Smartpay Holdings Limited shareholders are set to vote on a proposed NZ$1.20 per share cash acquisition by Shift4 Holdings Limited, with the Board unanimously recommending the deal. The scheme offers a significant premium amid regulatory and competitive challenges.
- Proposed acquisition price of NZ$1.20 per Smartpay share
- Unanimous Board recommendation pending no superior proposal
- Independent Adviser values Smartpay between NZ$1.07 and NZ$1.43 per share
- Scheme subject to shareholder and High Court approval
- Shift4 to fund acquisition via cash and debt facilities
Background and Deal Overview
Smartpay Holdings Limited, a New Zealand-based payment processing company with listings on both the NZX and ASX, has announced a proposed scheme of arrangement for its full acquisition by Shift4 Holdings Limited. The offer price stands at NZ$1.20 per fully paid ordinary share, payable in cash. This proposal culminates a competitive process that began earlier in 2025, involving multiple indicative offers, including one from Tyro Payments Limited.
The acquisition, if approved, will see Shift4, a global payments technology provider headquartered in Malta and a wholly owned subsidiary of Shift4 Payments, Inc. (listed on the NYSE), take full ownership of Smartpay. The transaction values Smartpay’s enterprise between NZ$280 million and NZ$370 million, representing a premium of over 90% to Smartpay’s share price before acquisition talks became public.
Shareholder Vote and Conditions
The scheme requires approval by Smartpay shareholders at a special meeting scheduled for 14 October 2025, with two key voting thresholds – at least 75% of votes cast in each interest class and more than 50% of total shares must be in favor. Additionally, the High Court of New Zealand must approve the scheme, and customary conditions such as no material adverse changes and regulatory consents must be satisfied.
Smartpay’s Board has unanimously recommended shareholders vote in favor of the scheme, contingent on no superior proposal emerging and the Independent Adviser maintaining that the consideration is within or above its valuation range. Notably, Microequities Asset Management Group Limited, a substantial shareholder holding approximately 13.3% of shares, has expressed its intention to support the scheme.
Valuation and Strategic Rationale
Calibre Partners, the Independent Adviser, has valued Smartpay shares between NZ$1.07 and NZ$1.43, placing the offer price near the midpoint. This valuation reflects Smartpay’s growth prospects, particularly its expanding Australian transactional business and the piloted New Zealand acquiring business, balanced against execution risks and regulatory uncertainties.
Smartpay operates in a competitive and evolving payments landscape, with regulatory changes in Australia and New Zealand; such as proposed bans on surcharging and interchange fee caps; posing challenges to future revenue streams. The acquisition by Shift4 is positioned as a strategic move to combine Smartpay’s regional distribution with Shift4’s global payment infrastructure, aiming to scale operations and enhance market penetration.
Next Steps and Market Implications
If the scheme is approved and implemented, Smartpay will be delisted from the NZX and ASX, and shareholders will receive cash consideration on the implementation date, currently expected to be 4 November 2025. Shift4 plans to fund the acquisition through existing cash reserves and revolving debt facilities, with no financing condition attached to the scheme.
Shareholders who do not support the scheme may vote against it or sell their shares on the market prior to the trading halt date, though the share price may trade below the offer price. The Board cautions that without the scheme, Smartpay’s share price is likely to decline given the operational and regulatory risks ahead.
Bottom Line?
The upcoming shareholder vote will be pivotal in determining Smartpay’s future amid industry headwinds and strategic consolidation.
Questions in the middle?
- Will any superior proposal emerge before the shareholder vote?
- How will regulatory changes in Australia and New Zealand impact Smartpay’s long-term profitability?
- What integration challenges might Shift4 face post-acquisition in the trans-Tasman market?