International Processor Planet Payment Could Find Itself in the Orbit of a New Owner

Planet Payment Inc., a specialist processor focused on multi-currency and related international payment services, this week said it has begun “a process to explore and evaluate potential strategic alternatives focused on maximizing shareholder value,” a process that could result in the sale of the company.

The review also could result in a merger or other “strategic transaction,” Long Beach, N.Y.-based Planet Payment said in a news release. Or, the publicly traded company could remain independent.

“Planet Payment’s board of directors is committed to fully evaluating appropriate strategic alternatives while simultaneously supporting the company’s management and employees in their ongoing efforts to deliver innovative products and outstanding service to our customers,” chairman and chief executive Carl J. Williams said in a statement. “We believe that pursuing these complementary paths is in the best interests of our shareholders and is designed to maximize value.”

Top executives haven’t set a deadline to complete the review, and they aren’t talking about what prompted it. During a Wednesday morning conference call to discuss Planet Payment’s second-quarter results, an analyst said the review was “the elephant in the room” and asked “if you were approached? Was this a proactive or reactive move on your part?”

Williams’ response: “Unfortunately, we can’t comment on that at this time,” according to a transcript from Thomson Reuters StreetEvents.

Planet Payment’s shares, which are listed on the Nasdaq Stock Market, were trading in the $3.40 range Friday morning, down 27% from their 52-week high of $4.64, but up from their low of $2.75, according to Dow Jones’ MarketWatch. The recent quarterly results disclosed a 54% year-over-year jump in net income to $1.97 million, but revenues slipped 4% to $12.5 million.

Planet Payment served a total of 176,870 active merchants in 22 countries as of June 30, down 1% from 178,198 a year earlier. The company’s biggest business is its multi-currency processing service, which generated 63% of its revenues last year. The service processed 4.96 million settled transactions in 2017’s second quarter, up 27% from a year earlier, on dollar volume of $725.7 million, up 9.5%.

Two of Planet Payments new planned rollouts, one of its Pay in Your Currency service through some merchant-acquirer partners, and the other of Chinese mega-acquirer UnionPay’s SecurePlus e-commerce product, have encountered delays, the company reported.