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Exclusive-Buyout firm Madison Dearborn approaches MoneyGram with acquisition bid-sources -Breaking

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© Reuters. FILEPHOTO: A kiosk with the MoneyGram logo in New York on 3 January 2018 is shown. REUTERS/Shannon Stapleton

By Greg Roumeliotis

(Reuters) – Madison Dearborn Partners LLC is a private equity company that approached MoneyGram International Inc. Two people who are familiar with the matter stated Wednesday.

Due to intense competition within the industry from digital rivals like Remitly Global Inc or Revolut, Revolut is now a potential acquisition target. This has affected its ability capitalize on the growing market in payments and remittances.

According to sources, there is not certainty MoneyGram will accept any deal. The company has a market valuation of $700 million, and $800 million of debt. Reuters reported that the company met with several potential buyers over recent years.

Madison Dearborn did not comment. MoneyGram spokespeople didn’t immediately reply to inquiries for comment.

MoneyGram claims to have served more than 150 million users in just five years. However, it has been increasing its focus on digital payments. The company announced that it had entered into a Blockchain partnership in October. It relies on Circle’s financial technology, which is one of the most rapidly-growing digital currencies.

In January 2018, the United States stopped a deal worth $1.2billion for China’s Ant Financial, which was to purchase MoneyGram. It did so because of national security concerns. MoneyGram shares were affected by this block, however they are now recovering. The shares are now up 28% year to date, versus an 18% increase in interest.

Due to an increase in transactional costs, the company’s third quarter operating income was $26.8m, down from $36.6m a year earlier.

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