UK technology companies typically go bust or are bought out before they reach the upper echelons of the global tech industry. Optimal Payments (OPAY) may be the rare exception: the international payments group is poised to join the likes of Arm, Sage and Micro Focus among the ranks of the UK's leading shares. After roughly doubling in size by acquiring US rival Skrill, the group is eyeing a main market listing and a spot in the FTSE 250. Optimal is also growing quickly, diversifying its business and profiting from the global proliferation of e-commerce, but its shares trade at an unjustified discount to those of its peers.
- Strong sales and profit growth
- Shares are cheaply rated
- Skrill deal has transformed prospects
- Leading player in mushrooming market
- Reliant on one key customer
- Challenge of integrating acquisitions
After listing on Aim as Neteller in 2004, the group acquired Netbanx in 2005 then Optimal Payments in 2011. The group processes payments, provides online wallets and sells pre-paid cards. It roughly doubled in size following its £846m takeover of rival payments group Skrill in August. The deal has added new services, allowed the group to process over 100 payment types in more than 40 currencies, and management expects it to generate around $40m in annual cost savings by the end of 2016.