Cuscal Launches $30M Raise to Fund $27M Takeover of NZ Payments Giant Paymark

Cuscal to acquire New Zealand payments leader Paymark for A$27 million

Cuscal Limited (ASX: CCL) has entered into an exclusive arrangement with Worldline to acquire 100% of Paymark Limited for A$27 million in cash consideration. Paymark is a leading payments infrastructure provider in New Zealand, processing more than 1.5 billion transactions annually and servicing all major New Zealand acquiring banks. The acquisition aligns with Cuscal’s existing Australian acquiring and switching business model, extending its payments infrastructure footprint into an adjacent market with an established, profitable platform.

Completion is expected by 30 June 2026, subject to a mandatory French Works Council consultation process customary for transactions of this nature. Once the consultation process concludes, Worldline may exercise a put option under the Put Option Agreement, triggering entry into a binding Sale and Purchase Agreement. No Cuscal shareholder approvals are required for the acquisition, and all requisite Paymark shareholder approvals have already been obtained.

Cuscal has reaffirmed its FY26 guidance alongside the announcement, continuing to expect high-single-digit transaction volume growth to translate to mid-teens Underlying NPAT growth.

Craig Kennedy, Managing Director

“Paymark represents a strategically aligned opportunity where value creation will be driven by strong standalone economics, limited integration, and the opportunity to deliver sustainable, long term returns for our shareholders.”

Financial returns and acquisition economics

The acquisition offers attractive valuation metrics and immediate earnings accretion. Cuscal is acquiring Paymark at approximately 5x FY27E Net Profit After Tax, representing a compelling entry price for a market-leading infrastructure asset. The transaction is expected to be mid-single digit EPS accretive in FY27, with Return on Invested Capital (ROIC) of mid-teens in FY27E.

Following completion of Paymark’s Switch upgrade investment programme, ROIC is expected to exceed 25%. The upgrade, which involves a A$21 million investment over the life of the programme and expected completion by FY30, will be funded entirely from Paymark’s own cashflows without requiring additional capital from Cuscal. This self-funding capability is reflected in the forecast earnings profile supporting the acquisition outcomes.

Post-completion, Cuscal’s CET1 ratio is expected to be in the range of 18%-19%, in line with the company’s target range and comfortably above regulatory minimums. The transaction delivers value without reliance on cost synergies, given Paymark’s standalone operating model and the intention to preserve operational continuity under Cuscal ownership.

Equity raising structure

The A$27 million cash consideration and transaction costs will be funded via a A$30 million fully underwritten Institutional Placement and a non-underwritten Share Purchase Plan targeting up to A$3 million. The Placement is priced at A$4.00 per share, representing a 5.0% discount to the last close price of A$4.21 on 13 April 2026. Approximately 7.5 million new shares will be issued, representing 3.9% of existing shares on issue.

The SPP will be offered to eligible Australian and New Zealand shareholders at the lower of the Placement Price or a 1.5% discount to the 5-day VWAP at the SPP closing date. Eligible shareholders may subscribe for up to A$30,000 worth of new shares, free of brokerage and transaction costs. Directors of Cuscal have indicated their intention to participate in the SPP.

What is payments infrastructure switching?

Payments switching refers to the technology infrastructure that routes and processes card transactions between merchants, banks and card networks. When a customer makes a card payment at a point of sale or online, the switch facilitates real-time authorisation by connecting the merchant’s acquiring bank to the cardholder’s issuing bank and the relevant card network. This critical infrastructure enables the seamless flow of everyday payments activity.

Paymark’s switch handles a material share of New Zealand’s everyday payments transactions, processing over 1.5 billion transactions annually across in-store, online and digital channels. The platform’s importance to New Zealand’s national payments ecosystem positions it as essential infrastructure, similar to Cuscal’s role in the Australian market.

Paymark has commenced an investment programme to upgrade its Switch technology, with total expected costs of approximately A$21 million over the life of the programme. The upgrade is expected to complete by FY30 and will be funded entirely from Paymark’s financial performance on a standalone basis. No additional capital from Cuscal is required, as the investment plan is embedded in the forecast earnings profile of the business. Upon completion, the upgraded Switch is expected to deliver material operational efficiency and resilience benefits, supporting improved returns as the ROIC trajectory exceeds 25% post-upgrade.

Strategic rationale and integration approach

New Zealand represents an adjacent, on-strategy market for Cuscal, with a payments ecosystem closely aligned to Australia and supported by attractive structural characteristics, including a concentrated switching environment. The acquisition provides immediate scale in a familiar regulatory and payments environment, delivering strong standalone economics without requiring cost synergies to justify the valuation.

Paymark will continue to operate as a standalone platform following completion, preserving operational continuity for customers and employees. The business operates largely independently under Worldline ownership and is supported by an experienced in-market management team with dedicated product, sales, technology, operations and customer support functions. Paymark CEO Maxine Elliott and her leadership team will continue leading the business post-acquisition, ensuring continuity of service delivery and strategic execution.

Maxine Elliott, Chief Executive Officer, Paymark

“The Acquisition supports long-term stability for Paymark while preserving operational continuity. We are pleased that Paymark will continue to operate as a standalone business, with no disruption to service delivery for our customers and continuity for our people.”

The largely standalone operating model results in minimal separation and integration complexity, enabling execution with minimal disruption to Cuscal’s management focus. This allows Cuscal to remain focused on existing strategic priorities, including the integration of Indue, delivery of the risk uplift programme and continued organic growth.

Key strategic advantages:

1. Adjacent market with similar regulatory and payments environment
2. Established blue-chip client base including all major NZ acquiring banks
3. Standalone operations requiring minimal integration
4. Experienced local management team retained
5. Enables Cuscal to remain focused on Indue integration, risk uplift programme and organic growth

Paymark’s market position

Paymark services all major New Zealand acquiring banks and maintains long-standing relationships with large corporate and merchant customers across multiple sectors. The business provides a comprehensive acquiring platform across in-store, online and digital channels, with new, innovative products in the development pipeline. This established market position and diversified customer base provide resilient revenue streams and opportunities for organic growth.

The acquisition addresses existing demand from Cuscal’s client base for New Zealand presence, creating natural cross-selling opportunities while maintaining Paymark’s independent operations and customer relationships.

FY26 outlook and transaction timeline

Cuscal has reaffirmed its trading guidance for FY26, continuing to expect high-single-digit transaction volume growth to translate to mid-teens full financial year 2026 Underlying NPAT growth. The reaffirmation signals that the acquisition does not distract from core business momentum and that management remains confident in the existing growth trajectory.

The tight timeline to completion reflects execution confidence and the advanced stage of transaction preparation, with all requisite Paymark shareholder approvals already obtained and APRA providing written notice that it does not oppose the acquisition.

The acquisition extends Cuscal’s geographical diversification while maintaining strategic focus on payments infrastructure. With strong standalone economics, minimal integration risk and attractive return metrics, the transaction is structured to deliver sustainable value creation without reliance on cost synergies or material capital deployment beyond the initial consideration.

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