Shares of W.A.G Payment Solutions Plc (LON:EWG), which operates under the Eurowag brand, experienced a sharp decline on Friday, dropping 7.4% to approximately 100p in early London trading. The sell-off followed a significant secondary share sale by major shareholder TA Associates, which offloaded 30 million shares at 100p each.
The transaction, which did not raise new capital for Eurowag, reduced TA Associates' stake from 17.1% to 12.7%. Since September, TA has executed two separate placings, disposing of a total of 91 million shares. This represents a 50.7% reduction from its original block before the sales, according to regulatory filings. The two transactions collectively generated £86.1 million before fees, with TA retaining 88.5 million shares valued at roughly £88.5 million at the current price.
Market Reaction and Volume
Eurowag shares opened at 101p, briefly touched a high of 101.4p, and then settled with bid-ask quotes of 99.5p and 100p. The closing price on Thursday was 108p, making the 7.4% decline closely match the discount set during the placing. Total displayed volume reached 30.27 million shares, just 268,579 above the placed block, indicating that Friday's trading was largely driven by the secondary sale.
The sponsor overhang has significantly diminished. The two placings are detailed below:
- September 2025: 61.0 million shares disposed at 92p, raising £56.1 million. TA ownership after: 17.1%. Lock-up: 90 days.
- July 2026: 30.0 million shares disposed at 100p, raising £30.0 million. TA ownership after: 12.7%. Lock-up: 90 days.
Based on June voting-rights data, there were 695.7 million shares in issue.
Company Fundamentals and Outlook
Eurowag reported improved operating metrics for 2025. Net revenue increased 12.9% to €330.1 million, while adjusted EBITDA rose 8.5% to €132.1 million. However, the adjusted EBITDA margin slipped to 40.0% from 41.6% the prior year. Net leverage declined to 1.9 times, reflecting a stronger balance sheet.
Management is forecasting revenue growth in the low double digits for the current year, with an adjusted EBITDA margin expected to remain around 40%. In March, Chief Executive Martin Vohánka stated that Eurowag would transition from a building phase to a scaling phase, focusing on operational efficiency and customer growth.
The next key catalyst for the stock is the first-half results, scheduled for release on September 9. Investors will be closely watching updates on customer migration and spending related to Eurowag Office. The company aims to migrate the majority of its customers to the new platform before the end of the year.
Risks and Key Levels
Despite the reduction in TA Associates' stake, risks persist. TA still holds 12.7% of the company, meaning a further sale could follow the lock-up period. Eurowag also faces the challenge of maintaining margins while managing a significant customer migration.
The 100p level has become a critical benchmark for the market. If prices remain above this level, it would indicate that institutional investors have absorbed the block. A drop below 100p could raise fresh concerns about unsold shares and potential further selling pressure.
