Worldpay Adds To £6bn London Float Line-Up

Worldpay, the UK-based payment processing giant, has picked a leading City firm to prepare it for a flotation that could propel it straight into London's blue-chip share index.

Sky News understands that the private equity-backed company has hired Lazard, the investment bank, to provide independent advice on the listing, which could value it at about £6bn.

Worldpay is owned by Advent International and Bain Capital, which bought it from Royal Bank of Scotland (LSE: RBS.L - news) in 2010 as the lender sought to dispose of assets following its mammoth taxpayer bail-out.

A flotation of the company in London is now the likeliest exit route for Advent and Bain, although they will also look at New York equity markets, while a small number of alternative buyers could also be sounded out in the coming months.

The trajectory of stock markets may, however, price out any emerging bidders.

Worldpay, which is also working with Goldman Sachs (NYSE: GS-PB - news) , has grown at a spectacular rate since it was carved out of RBS in a deal worth around £2bn.

Specialising in the provision of secure payment services, its major corporate customers include Google (Xetra: A0B7FY - news) and Sony (Swiss: SONC.SW - news) .

It processes 26 million transactions daily and operates in more than 40 countries.

Comparable listed companies such as Wirecard (Xetra: 747206 - news) and Brazil’s Cielo (Sao Paolo: CIEL3.SA - news) tend to trade at between 14 and 20 times their annual profits.

With Worldpay expected to record around £400m of pre-tax profit in 2015, a similar valuation range would attribute a price tag of between £5.6bn and £8bn to the company.

In the UK, Worldpay combines the former Streamline business with Cardsave, YESpay and Zinc, handling well over half of all card transactions.

The company sees further growth opportunities in the ongoing push to open up payment systems, with a new regulator recently assuming oversight of the industry.

The sale of Worldpay was among the conditions imposed on RBS by the European Commission in return for the £45.5bn of state aid received by the bank during the financial crisis.

For the last two years, the company has been led by Philip Jansen, a former executive with the catering group Sodexo and MyTravel, the tour operator.

Under his leadership, it has begun implementing a new brand identity using the slogan "Leaders in Modern Money".

Worldpay’s chairman is John Allan, who has just taken over in the same role at Tesco (Xetra: 852647 - news) , which last month announced one of the biggest annual losses ever recorded by a British company.

Since its takeover by Advent and Bain, Worldpay has sharply increased both turnover and profits, with Mr Jansen’s predecessor as chief executive saying the company had been "unshackled" by the sale.

Worldpay, which could not be reached for comment on Lazard's appointment, also owns a valuable stake in Visa Europe.