December 7, 2023


For the payments industry, an October surge in acquisitions may be the start of a yearend upswing in activity.

Payments consulting firm The Strawhecker Group counted nine deals in the industry so far this month, a spokesperson for TSG said, making October the second most active month for mergers and acquisitions this year.

And TSG Director Sam Wares said he’s hearing a lot of chatter about upcoming deals. “I’m at a payments conference, Money20/20, right now, and there are so many companies that are here walking the floor to find a deal,” Wares said during a Tuesday interview this week.

Wares expects the October uptick to continue through the end of 2023, with payments companies opening up their wallets and shopping for acquisitions again this quarter. 

What kind of deals are happening?

In an emailed M&A report, TSG said payments companies have focused on purchases of independent sales organizations this month. ISOs accounted for four of the nine deals in October. Why ISOs? These purchases enable companies to “expand their geographic presence, obtain new technology or solutions” and “grow their customer bases,” the note said.

One ISO deal was payments technology provider Stax’s purchase of payments processing software provider Atlantic-Pacific Processing Systems, according to TSG.

Deals in other categories included payment processor Shift4 Payments purchasing a sports and entertainment business unit from SpotOn for $100 million; payment processor Fiserv’s acquiring Brazilian company Skytef; and payments technology company NMI buying the commercial division of payments software provider Sphere.

It’s been a volatile year for payments M&A

Monthly M&A deals peaked in January so far this year, and Wares attributed that to “a bit of a carryover from December.” But as the year went on, “it was clear that 2023 was not going to hit the pace of 2022,” he said.

After the January high of 10 deals, M&A slumped to four to six deals per month from February through July. August was a bright spot, with eight deals, but September’s count was just four deals. Wares tallied 114 deals in 2022. As of Tuesday, 58 deals have occurred this year, Wares said.

Outside of the payments industry, M&A has been down across the board for U.S. companies. The total value of U.S. M&A deals for the first three quarters of 2023 was $905 billion, nearly a 24% drop from the same period in 2022, when total deal value was $1.19 trillion, according to data from The Wall Street Journal

What about the rest of the year?

There is reason to believe that October won’t be a temporary spike like August, Wares said. He expects eight to 10 deals a month for the rest of the year. It’s not a science, he said, just a reflection of typical M&A strategy. 

“Those strategies were set at the outset of the year, and then you’re spending time finding those targets and it just takes time to close those deals,” Wares said. “If it started during the year, they try to wrap it up by the end of the year.”

Following this year, TSG is expecting a return to normal M&A numbers. “2024 is anticipated to be a bounce-back year with a potential for much more activity throughout the industry,” the firm said in its client note.

That optimism was echoed in a report released Tuesday by consulting firm McKinsey, which said that its recent survey of fintech executives showed nearly 60 percent of them are considering an acquisition sometime in the next 18 months.


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