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AAP
AAP
Business
Derek Rose

Westpac walks away from Tyro Payments

Westpac told the ASX that making a bid for Tyro wasn't in the best interest of Westpac shareholders. (James Ross/AAP PHOTOS) (AAP)

Westpac has decided not to make a bid for Tyro Payments, and the eftpos machine provider's board has rejected an offer from a private equity firm.

Tyro told the ASX on Monday that Sydney-based Potentia Capital Management's $875 million, $1.60-per-share offer "significantly undervalues" the company.

Atlassian founder Mike Cannon-Brookes, Tyro's biggest shareholder with a 12.5 per cent stake, had backed the Potentia bid.

Westpac meanwhile told the ASX in a very brief announcement that after completing due diligence on Tyro, it has decided that making a bid wasn't in the best interest of Westpac shareholders at this time.

At 11.02am AEDT, Tyro shares were down 15.6 per cent to a three-month low of $1.2575.

Tyro's board said it remained open to any "credible change of control transaction that represents compelling value for Tyro shareholders" and said it was tracking to the top end of guidance.

In the five months to the end of November, Tyro had facilitated $17.6 billion in eftpos transactions, up 43 per cent from a year ago.

Its machines were used by 63,700 Australian merchants as of June 30.

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