Sage, the FTSE-100 technology group, is in talks to sell Sage Pay, the division that processes payments for thousands of small business customers.
Sky News has learnt that Newcastle-based Sage has hired Rothschild, the investment bank, to find a buyer for the division.
Details of the sale process, including Sage Pay’s valuation and the identity of prospective bidders, was unclear on Monday.
The unit boasts around 50,000 SME customers but accounts for only a small percentage of group sales and profits, according to a source close to the company.
An auction of Sage Pay is understood to have been kicked off several weeks ago, and is likely to draw interest from other payments groups as well as private equity firms.
The decision to offload the business follows Sage’s decision to sell its US payments software business in 2017 and its payroll business in January this year.
Payments sector takeover activity has surged in recent years as processors have seized on the need to consolidate.
Sage, which is focused on transforming itself into a cloud-based software company, specialises in accounting, human resources and payroll products for business customers.
Last year, it named its finance director, Steve Hare, as chief executive in a bid to accelerate its shift.
In late July, Sage’s shares fell by nearly 11%, the biggest single-day decline in 16 years, after disclosing a sharp fall in software and software-related revenues.
Sage declined to comment.
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