Transforming Europe’s largest consumer payments acceptance network

Duke Street has acquired a 69% shareholding in the Payzone Group, Europe’s largest consumer payments acceptance network, at an enterprise value of €104 million, as part of the AIM-listed company’s financial restructuring. The deal values the business at 3.6x 2009 EBITDA.

The Payzone Group comprises two businesses, Payzone (formerly known as Alphyra) and Cashzone (formerly known as Cardpoint). The Payzone business manages terminal networks in the UK, Ireland, Sweden, Greece and Romania, which process a variety of electronic transactions. The main services include mobile phone top-up, utility top-up, bill-payment solutions, electronic gift vouchers and electronic funds transfer processing. The Cashzone business deploys branded independent ATMs in the convenience sector in the UK and Germany.

Origination and execution

Duke Street had been tracking both Cardpoint (since 2006) and Alphyra (since 2007), while they were both stand-alone businesses. The merger in 2007 brought considerable strain on the combined group, as it was badly executed and provided limited strategic benefit. Duke Street initiated contact with Payzone’s largest shareholder, Balderton Capital, in early 2008 to see if it could help restructure the business. As the value of sterling collapsed and trading deteriorated in early 2009, the company appointed Rothschild to consider a range of new financing options. Duke Street’s long association and knowledge of the business made it the ideal partner to complete a successful restructuring.

The financial restructuring reduces Payzone’s level of senior secured debt from approximately €300 million to €77 million. As part of the process, Payzone’s seven bank lenders become shareholders in the restructured group. Duke Street’s equity investment provides significant growth capital to develop the business.


Duke Street sees attractive opportunities to grow both Payzone and Cashzone thereby further strengthening the leading market positions they already hold in their respective markets. In Payzone the growth is expected to come from launching new payment services such as cash-less parking/prepaid cards and targeted complementary acquisitions. The independent ATM markets in both the UK and Germany are fragmented and Cashzone is well placed to lead a consolidation of the sector. In addition there may be opportunities to selectively expand the ATM networks in both countries.


The original strategy was always to exit Payzone and Cashzone separately. We only successfully sold the Cashzone ATM business to a trade buyer after a long and complex exit process.