Canadian payments software firm Lightspeed explores sale, sources say

Lightspeed Commerce

26/09/2024 24:40

(Adds comments from Lightspeed in paragraphs 6 and 7)
    By Milana Vinn
       SAN FRANCISCO, Sept 25 (Reuters) - Lightspeed Commerce
 LSPD.TO , a Canadian payments software maker with a market
value of C$3.2 billion ($2.37 billion), is working with a
financial adviser to explore options including a potential sale,
according to people familiar with the matter.
    The sale talks come months after the Montreal-based company
replaced its CEO Jean Paul Chauvet and brought back founder Dax
Dasilva at the helm, as investors raised concerns over the
company's plan to prioritize growth over profitability following
disappointing quarterly results in February. 
    Lightspeed has tapped investment bankers at JPMorgan Chase
 JPM.N  to evaluate its options and solicit interest from
potential buyers, which could include private equity firms, the
sources said, requesting anonymity as the discussions are
confidential.
    The talks are at an early stage and a deal is not
guaranteed, the sources said. Lightspeed's U.S.-listed shares
jumped as much as 17% on Wednesday after Reuters reported on the
sale talks.
    Lightspeed said in a statement that it has initiated a
strategic review of its operations and engaged in discussions on
"potential strategic alternatives".
    The software maker said it is exploring various options,
"including partnerships, acquisitions, or transactions, to
enhance growth and shareholder value."
    JPMorgan declined to comment.
    Lightspeed's share price performance and Advent
International's buyout of rival Canadian payments firm Nuvei has
prompted Dasilva to stay open to the option of the company being
taken private, he told Bloomberg in a March interview.  
    Lightspeed's stock has lost more than a third of its value
since the company went public about five years ago, as weak
consumer spending weighed on its performance. Its shares are
currently trading at C$18.79, having peaked at C$155 in 2021
when it rode a wave of investor enthusiasm for financial
technology providers that thrived during the COVID-19 pandemic. 
    The company's shares tanked later in 2021 after short-seller
Spruce Point Capital published a report alleging that the
company had inflated its numbers following its initial public
offering. Lightspeed denied those allegations at the time. 
    Since his return to Lightspeed, Dasilva has reversed the
earlier CEO's strategy and has made the pursuit of profitability
a centerpiece of his strategy to turn around the company's
fortunes. 
    Lightspeed is a provider of payments software that is
primarily used by restaurants and other businesses.    
 ($1 = 1.3475 Canadian dollars)

 (Reporting by Milana Vinn in San Francisco; Additional
Reporting by Mrinmay Dey in Bengaluru; Editing by Jonathan Oatis
and Stephen Coates)
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