Acquisitions

API Compliance can assist firms looking to buy or sell a payment institution (SPI/API), or electronic money institutions (SEMI/AEMI) in the UK.

Buying an existing firm vs authorisation

There are many reasons why an organisation would choose to buy a payment institution rather than go through the application process for a new firm, such as improved time-to-market, or to acquire an existing client base. The pros and cons are:

How API Compliance assist in buying or selling a payment services or e-money business?

With our wealth of industry knowledge and connections, we can assist with appraisal and fair market valuation. Connect suited prospective buyers with sellers. Broker the transaction, assist with the Change-In-Control application, and support the purchaser’s business in its onward journey as required with services such as Variation of Permission or recruitment.

How we work

Based on years of experience and dozens of transactions in this field, some of the key factors to successful transactions include:

• Minimising the number of intermediaries – meaning we do not work with intermediary brokers. We offer firms for sale if we are in direct contact with the seller, and we do not advertise other firms’ deals.
• Clear, transparent communication, including thorough due diligence
• For each licencing project, we assign at least 2, but typically 3 specialist dedicated consultants you can speak to directly. Consultants maintain contact through at least weekly project meetings.
• Before we accept your project, we will try and explain the risks. Where they are too great, we will simply advise you not to proceed.

How we can assist buyers

We can help you to:

• Find a suitable firm – (We may already be aware of an available candidate firm)
• Conduct due diligence on the candidate firm
• Provide advisory support around the structure of the transaction and business post-acquisition
• Introduce legal firms to support you with legal due diligence, share purchase agreement (SPA) drafting, and negotiations, formal completion, etc.
• Draft the FCA s178 change in control filing and assist with responses to FCA follow-up questions
• Post-acquisition, we offer a range of on-going compliance support services  

How can we assist sellers

We can help you to:

• Prepare your firm for sale, including resolving outstanding issues affecting saleability and valuation
• Advise on estimated valuation of your firm
• Find and vet a reputable buyer for the business

Overview of the entire process and timeline

• The buyer is provided with a list of companies on a no-name basis
• Preparation of the buyer and seller, and vetting for eligibility, including proof of funds
• Non-disclosure agreements and party introductions
• Due diligence
• Negotiation
• Sign Share Purchase Agreement, and deposit (if applicable)
• Draft Change-In-Control, and file to the FCA.
• Assist the FCA with any questions

Time scales

Although some activities are out of our control, e.g., solicitor interactions and FCA processing times, the process usually takes 4 to 6 months.

Post-completion

The buyer may continue to utilise our on-going services to support recruiting, governance, AML, horizon scanning, IT, and reg reporting. For more information, see our retainer services. 

Our track record

After over 10 years in business, we continue to proudly hold a 100% approval rate for all filings wherein we support buyers and sellers with their change in control.