Westpac ends Tyro buyout talks

Westpac has ended acquisition talks with payments provider Tyro without making a formal offer.

The bank revealed it was in early-stage negitiations back in October. However, at the time, it noted “there is no certainty that any transaction will result.”

On Monday, the bank stated [pdf] that following due diligence, it made the decision “that submitting an offer is not in the best interests of Westpac shareholders at this time.”

In a separate statement, Tyro said [pdf] that "extensive discussions” had occurred with Westpac and another potential suitor, private equity firm Potentia.

Tyro also said private equity firm Potentia put forward a non-binding "indicative proposal" valuing it at $875 million.

It said a decision was ultimately taken to “cease all current discussions with these parties in relation to a possible change of control transaction”.

“Those discussions have not resulted in a proposal that the Board believes fairly values Tyro," the company said.

Tyro said it “remains open” to “credible” sale talks that provide “compelling value for Tyro shareholders”. 

“Based on the board’s assessment of the company’s attractive growth prospect in the Australian payments and business banking markets, no such proposal has been received.

“Accordingly, the board and management will continue to focus on executing on Tyro's current strategy.”

Tyro's shares fell almost 20 percent after the announcements were made, and were trading at $1.20 at the time of publication.